The objective of this study was to characterize a group of small dairy producers in the central coast of Peru and determine the most important limiting factors that affect animal productivity, using Participatory Rural Appraisal methodologies. The information collected during a year included biological and socio-economic characteristics. Inappropriate nutrition, management, health and reproduction were observed in most farms. The average number of animals per family was 17.3, of which 40% were bulls and growing calves. Milk production and net cash income were reduced in the summer. The feeding programme for lactating and growing females of forage exchanged for labour and purchased concentrates did not theoretically or practically meet the cows' needs. All water was carried to the site on donkeys from one kilometre distance. All cows were negative for a number of potential infectious diseases. By California Mastitis Test of routine samples 7.1% of cows had clinical mastitis and 66.1% subclinical. Taking notional labour and forage costs into account, milk production was at a loss but the farmers considered neither and were satisfied with a net cash income from milk sales three times the average agricultural wage. © 2007 Springer Science + Business Media B.V.