Land-use options that increase resilience and reduce vulnerability of contemporary societies are fundamental to livelihood improvement and adaptation to environmental change. Agroforestry as a traditional land-use adaptation may potentially support livelihood improvement through simultaneous production of food, fodder and firewood as well as mitigation of the impact of climate change. Drawing on the representative literature, here, I critically review the contribution of agroforestry systems in India to: (i) biodiversity conservation; (ii) yield of goods and services to society; (iii) augmentation of the carbon storage in agroecosystems; (iv) enhancing the fertility of the soils, and (v) providing social and economic well-being to people. Agroforestry systems in India contribute variously to ecological, social and economic functions, but they are only complementary - and not as an alternative - to natural ecosystems. To promote well-being of the society, management of multifunctional agroforestry needs to be strengthened by innovations in domestication of useful species and crafting market regimes for the products derived from agroforestry and ethnoforestry systems. Future research is required to eliminate many of the uncertainties that remain, and also carefully test the main functions attributed to agroforestry against alternative land-use options in order to know unequivocally as to what extent agroforestry served these purposes.