The main objective of this research was to investigate the farmers’ and specialists’ perception toward privatization of agricultural extension in Ilam province. The population of this study consisted of two groups: all extension specialists, as well as the subsistence farmers in the province. A questionnaire was designed to collect data. All specialists (42), as well as 136 of the farmers were proportionately sampled through a complete randomized sampling process. The results indicated that %51.5 of ESs and 72.5% of the farmers had negative or somewhat negative perception toward extension privatization. Farmer’s level of participation in extension educational activities was assessed to be at a medium level. The level of agricultural mechanization practiced by farmers was considered to be at a “low” level. Bivariate Correlation coefficients showed statistically significant relationship between rural population density, amount of farming land area, mechanization level, the level of participation in extension activities, and farmers’ perception toward agricultural extension privatization. Multiple regression analysis indicates that the variables of participation in extension educational activities and the area of farming land owned by farmers explained %27 of variation in farmers’ perception toward extension privatization.