On-farm production diversity of smallholder farmers can improve the nutrition security of the household. The objective is to determine the significance and relevance of this relationship by considering the different degrees of separability between both the commercial and consumptive production of food. A household-level survey covering socioeconomic, agricultural and nutritional data was conducted in three regions of India from January to June 2017 including 1324 households in 119 villages. Various regression specifications (OLS, Poisson, Probit, IV / non-IV) were used to estimate the effect of production diversity on dietary diversity. Average yearly rainfall since 1981 is the excluded instrument. A positive association is estimated (ß: 0.417 / 0.016 | IV / non-IV). Access to markets improve dietary diversity on average by 0.5 food groups. The increase is significant only for a few food groups (dairy products, nuts and vegetable) and primarily, it is the higher income groups that benefit from market integration. In conclusion, production diversity does improve nutrition security, but the positive market effect is stronger for farming households that have a higher income.