Economic development introduces opportunities for subsistence households to diversify income sources. Timor-Leste is undergoing this transition; however, little is known about the patterns of household strategies and the effects of rural development on child wellbeing. We derive strategies from 190 households in two rural Timor-Leste communities and examine the links between resource strategies and child growth using linear mixed modeling. Children's z-height, z-weight, and z-BMI are well below international standards. We find agriculture remains predominantly subsistence-based, with some reliance on cash flow from government pensions and salaries. Households with stable income sources are better able to accumulate wealth, and children living in salaried households have better z-height. However, child growth is best predicted by individual-level factors rather than household ecology. Substantial variation in household strategy and little association of strategy with growth indicates there is no best' strategy in this transitioning environment.