The study examined the effect of diversification onthe performance of selected pharmaceutical shops in Ilorin, Kwara State. A survey research design was adopted for the study. A structured questionnaire was used to collect data for the study. The study adopted the test-retest reliability method and content validity. The population of the study consists of 166 employees from 12 selected pharmaceutical firms.The sample size of 117 was determined by using Yamane’s (1968) sample size determination formula.Findings showed that conglomerate diversification has a positive effect on the performance of pharmaceutical stores (ß = 0.654, 0.000 < 0.05). Concentric diversification has a positive effect on the performance of pharmaceutical stores (ß = 0.216, 0.019 < 0.05).The study concluded that70% of the change in performance of selected pharmaceutical shopswas brought about by the dimensions of diversification. Organizations were recommended to use diversification as a survival strategy to outperform their rivals.