In the northern highlands of Ethiopia degraded hillsides have been allocated to landless farmers for tree planting since the mid-1990s. The authors assessed the effect of hillside plantations on the livelihoods of landless farmers in the eastern part of the Tigray Region by using transect walks, focus group discussions, and pretested questionnaires. A matched-pairs design was used to compare crop yields, livestock holdings per household, and household incomes to test the differences before and eight years after the intervention. In addition, regression analysis was used to capture variables influencing hillside management. The findings revealed that the plantations significantly increased crop yields, livestock holdings, and the household incomes of all beneficiaries. In addition, tree planting on degraded hillsides had a positive impact on the livelihoods of formerly landless farmers. However, moisture stress and free-ranging livestock were crucial problems. The findings are highly relevant in a conservation context because many existing or planned hillside allocations to landless farmers are located on degraded steep slopes that are unsuitable for crop production. Thus, replicating the practice to other areas with similar environment and problems would be worthwhile, although the management should focus on careful planning to avoid conflicts of interest between beneficiaries and non-beneficiaries