Farming activities have gone through a period of deep restructuring following market and policies evolution. Higher levels of integration and quality standards are required for agricultural enterprises to compete on global markets. But at the same time, the changing countryside and the new rural development model offer the agricultural enterprises new opportunities for implementing a wider range of activities (direct sales, organic and typical foods, agro-tourism, environment, etc.) and playing new roles in society. The Italian Legislative Decree No. 228 issued on 18 May 2001 entitled ‘Orientation and modernization of the agricultural sector’ tries to take in account these changes, by introducing important legal innovations in the definition of agricultural activity. The decree also introduces new tools for implementing agricultural and rural policies at a local level (agro-food and rural districts). This chapter analyses the main elements of the Legislative Decree No. 228, with special emphasis on the new definition of agricultural activity in the light of diversification and multi-functionality and the characters of the new local governance forms.