Based on data from the Yunnan Province farm household survey, we examine the effect of rural land rights policy on farmers’ income. The regression results show that right significantly raises the total income of farmers, with farm income serving as the primary source of total income. After performing numerous robustness tests, using instrumental variables to handle endogeneity and arriving at the same conclusion, the result is still valid. According to the heterogeneity analysis, in the sample of households with long-term migrant workers, the confirmation of rural land rights significantly increases total and nonfarm income while decreasing farm income. Furthermore, total income includes nonfarm income, which reflects the effect of different farmers' optimal labor allocation based on the external market environment. According to the impact mechanism anal-ysis, right can increase farmers' total income by promoting land transfer, and farmers in less developed areas are more willing to increase their income by land transfer out.