Small farms constitute most of the world’s farms and are a central focus of sustainable agricultural development. However, the relationship between farm size and production, profitability, biodiversity and greenhouse gas emissions remains contested. Here, we synthesize current knowledge through an evidence review and meta-analysis and show that smaller farms, on average, have higher yields and harbour greater crop and non-crop biodiversity at the farm and landscape scales than do larger farms. We find little conclusive evidence for differences in resource-use efficiency, greenhouse gas emission intensity and profits. Our findings highlight the importance of farm size in mediating some environmental and social outcomes relevant to sustainable development. We identify a series of research priorities to inform land- and market-based policies that affect smallholders globally.