The objective of this paper is to identify which household factors and farm features determine the farm income in the rural households in the Northern Region of Ghana, and further to examine how farm income, nonfarm income and other socio-demographic factors affect the household fresh vegetable expenditure. The simultaneous equation model is applied to explore the interacting relationship between farm income and the fresh vegetable expenditure. The results indicate that the farm features such as cultivation of staple crops, total number of acres under groundnut cultivation, and the number of bullocks are the major determinants of the farm income, while the socio-demographic factors such as the nonfarm income, education, household composition, age, and gender of the household head significantly affect the fresh vegetable expenditure in the rural households.