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To study problems caused by land fragmentation in Fars province of Iran, 53 villages were selected and a random sample of 250 farmers was interviewed. After data collection, farmers were classified in terms of number of land parcels and cultivated area into four groups. Then, the effects of land fragmentation on variables such as labor, cost of water use, cost of machinary and transportation cost were determined and their differences among groups were tested statistically. The results of the study revealed that the costs of using these inputs were increased in proportion to increase in the degree of land fragmentation. Increase in cost due to land fragmentation implies that a land consolidation program must be initiated and financed by the government to increase farmers’ efficiency.