This study identifies evidence of the influence of diversification and leverage on the financial performance of Brazilian and Mexican family businesses. It analyzes 102 Brazilian and 71 Mexican publicly traded family companies. Data analysis uses ordinary least squares regression in Stata. The results indicate that Brazilian family businesses have a higher return on assets when diversifying their products or services. When diversifying international markets, Brazilian companies present a lower return on assets and return on equity. For Mexican companies, international diversification derives a higher return on assets and return on equity. In addition, results show that leverage moderates the relationship between diversification and performance both for Brazilian and Mexican family businesses. The study contributes to the current literature by investigating that diversification improves business performance and that leverage is a significant element in intensifying the benefits of this strategy in the performance of family businesses. The study also emphasizes that diversification can be useful to address market difficulties and imperfections in unstable scenarios, such as when it is targeted to planned performance and considers financial conservatism in family companies.