This paper presents an assessment of land use changes and their impacts on the ecosystem in the Montado, a traditional agricultural landscape of Portugal in response to global environmental change. The assessment uses an agent- based model (ABM) of the adaptive decisions of farmers to simulate the influence on future land use patterns of socio-economic attributes such as social relationships and farmer reliance on subsidies and biophysical constraints. The application and development of the ABM are supported empirically using three categories of input data: 1) farmer types based on a cluster analysis of socio-economic attributes; 2) agricultural suitability based on regression analysis of historical land use maps and biophysical attributes; and 3) future trends in the economic and climatic environments based on the A1fi scenario of the Intergovernmental Panel on Climate Change. Model sensitivity and uncertainty analyses are carried out prior to the scenario analysis in order to verify the absence of systematic errors in the model structure. The results of the scenario analysis show that the area of Montado declines significantly by 2050, but it remains the dominant land use in the case study area, indicating some resilience to change. An important policy challenge arising from this assessment is how to encourage next generation of innovative farmers to conserve this traditional landscape for social and ecological values.