Agricultural commodity production constitutes an important livelihood source for farmers but significantly contributes to tropical deforestation and biodiversity loss. While the socioecological effects of agricultural commodities such as palm oil, cocoa and coffee are well studied, the effects for commodities such as cashew (Anacardium occidentale) have received less attention. Global cultivated area for cashew increased rapidly from 526,250 ha in 1980 to ~5.9 million ha in 2018. India is the world's second largest cashew producer, with cashew farms often occurring adjacent to remnant forests. To mitigate deforestation for cashew expansion, it is necessary to understand present-day land use policies and management practices that drive this expansion. Through semi-structured interviews (n = 65) and a literature review on agricultural policies in India, we evaluated the role of state-led land use policies in cashew expansion and characterised present-day cashew farming systems in the Sawantwadi-Dodamarg landscape in India. Agricultural subsidies introduced from 1980s to 1990s encouraged cultivar cashew expansion and influenced land use conversion from rice and privately owned forest to cashew. Farmers preferred cultivar cashew as they produced higher yields faster, although they required more agrochemical inputs and were susceptible to pests and wildlife depredation. About 80% of farmers had planted cashew farms by clearing forests in the past 30 years and expressed interest to continue the same. Farmers avoided applying for government-sponsored compensation for crop losses due to wildlife depredation and chose instead to expand cultivar cashew into forested areas. Our study deepens the understanding of how government-led agricultural subsidies drive farmers' uptake of cashew cultivars, farmers' cashew management practices, and how these factors drive deforestation in this landscape at the state and farm level. We recommend further research with equitable stakeholder participation in cashew farming systems to devise sound planning for forest conservation and sustainability standards for the cashew industry.