The paper has demonstrated slow growth rate of agricultural output, escalating input cost, declining profit margin, fragmentation of land, and unemployment are the symptoms of the Punjab’s economy. In such a situation, it become imperative to study how the tenant farmers survive in farming. To keep in mind the above facts, the present study was undertaken to examine the nature of tenancy system and constraints faced by tenant farmers in the state. The study was based on the primary data, collected from 120 farmers, for all the three agro-climatic zones of Punjab pertaining to the crop year 2017-18. Descriptive tools were used to study the nature of tenancy and mean score was used for constraints analysis. The study highlighted that to make them self employed or fulfill the need of family, tenant farmers took land on leased from cultivator who switched to another sector and migrated in large number outside the country. From the study it was perceived that with the increase of size of holding and majority of tenant farmers adopted land holding to improve the scale of farming and to be economically viable.