Conversion of natural habitats through different land utilisation practices is the single largest cause of loss of biological diversity in Sikkim. In the Sikkim Himalaya, 75% of the total resource needs are derived from natural as well as the agro-forestry system due to free and easy access and simplicity in their use. The ever-increasing human and livestock populations in rural areas exerts immense pressure on forests and impact directly on livelihoods by causing shortage of resources such as firewood and fodder. Utilisation of resources by selection of species with preference is widely practised in the Sikkim Himalaya. These practices have created immense pressure on the preferred species leading to change in species composition and distribution of these preferred species in natural forests. However, farmers have made very little efforts in understanding the basis of such preferences of plant species, with reference to people's ranking and their chemical properties.This paper forms an extended abstract to the paper presented at the Kunming conference on Sustainable Forest Management and Poverty Alleviation held in December 2007.