Soil erosion is a significant problem in the uplands of the Central Coast of Vietnam. It affects the livelihood of farmers and could hinder the long-term economic development efforts in the uplands. Yet, trapped in poverty, upland farmers, especially the ethnic minority, are still using erosive land use systems to meet their immediate needs. This study demonstrates how the level of soil erosion varies across the typical land use systems. The fruit tree based agroforestry system is least erosive and most financially profitable. Measured by the annualized income loss, the on-site costs of soil erosion under upland rice-based and eucalyptus-based systems are VND 1,022 and 1,019 thousand/ha per year, respectively. That under the sugarcane system is VND 635 thousand/ ha per year, as compared (in all cases) to the fruit tree-based agroforestry system. The choice of land use system is influenced by farmers' attributes, land plot characteristics, and policy-related variables. Promoting the switch to agroforestry systems and the adoption of soil conservation measures is essential in reducing soil erosion and sustaining development in the uplands. It is, however, a very challenging task.