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In light of the increasing importance of science and technology in agricultural development, this article focuses on the role of extension in disseminating innovative techniques and knowledge in Iran’s agricultural sector. By constructing a conceptual framework following a review of the literature, it examines Iran’s agricultural development as a function of the performance of the agricultural system and its internal elements including extension. The article utilizes a number of statistical methods to reach the following conclusions: Agricultural development is a function of a host of factors, among which agricultural extension is one of the most important. Agricultural extension influences agricultural development by enhancing the farmers’ knowledge and skills. However, the extent of this influence depends on a few other factors that are referred to as control factors in this article. These include intra-sectoral factors of extension and the agricultural system as well as factors stemming form the natural and social environment. It is necessary to consider these factors in programs focusing on agricultural extension and agricultural development.