Village-farming groups, perceived as the most efficient form of farm management in mountamous areas, are recently in a move towards incorporation. This research aims to clarify the ways of function strengthening of incorporated village-farming groups as they compare with non-incorporated ones, and to show the way of assessing their achievement, as an essential component of agncultural policy（in mountainous areas）. The research consists of a discussion on the role the most efficient form of farm management, the significance of village farming groups, and case studies of five village-farming groups operating in Shimane Prefecture. The elements of function strengthening are as follows:（1）regional management and preservation, （2）furtherance of famiy farms and village-farming groups, (3）building of development power within the organization, （4）formation power of a support and driving force, and（5）preservation function of residential environment. Besides Decoupling Policy in disadvantaged areas, developing a sense of civism is an important factor in these elements of function strengthening.