Mathematical programming results revealed that moving toward more flexible agricultural policies would generate substantial economic and environmental gains in a North Carolina diversified cropping region. But in a Washington-Idaho dryland grains region, only the use of relatively new and sometimes problematic alternative cropping systems permitted environmental and economic gains under policy reform. In both regions, a recoupling policy, which links government payments to resource-conserving farming practices, was needed to protect environmental quality when market prices for program crops were high.