Dryland farming is still to be a main activity of the community around the part of Forest Area (Bagian Daerah Hutan/BDH), Panggang, Kesatuan Pengelolaan Hutan (KPH) Yogyakarta. This study aimed to determine the efficiency of dryland farming and the factors that influencefarming income. The survey method was used to carry out farming data and information by interview the farmer. The R/C analysis, labor productivity analysis, and capital productivity analysis were used to determine the efficiency of dryland farming. Furthermore, to determine the effect of production input factors on farming efficiency, a multiple linear regression analysis was carried out. The results showed that dryland farming by the community around BDH Panggang forest was not efficient because the value of R/C<1 (0,44), labor productivity Rp 29.522,69/working people’s day is lower than a local standard wage Rp 50.000/ working people’s day, and the productivities of land and capital are negative value. The factors production, land area, seed cost, fertilizer cost, pesticide cost, and labor have simultaneously impacted the farmers’ income for dryland farming. The factors of seed cost have been a significant effect on the farmers’ income in dryland farming.