The development of broad-acre agriculture is a dominant land use feature of the Avon River Basin. Since initial European settlement in 1831, economic development began with an expanding sandalwood industry until 1848 when the resource became over-exploited. Subsequent regional development was based on pastoralism. The lack of transport, water supply and communications infrastructure constrained further development of the region.

The regional economy is now based on agriculture, particularly the grain industries. There are smaller mining, commerce, manufacturing, and tourism industries in the region. Estimates of the Gross Regional Product for the Wheatbelt for 2001- 02 were $2.8 billion (Department of Local Government and Regional Development estimates). The value of agricultural production in the Wheatbelt was $2.2 billion in 1999-2000 of which $1.2 billion was the value of wheat production. Wool was valued at $216 million and livestock disposals $218.3 million. Agricultural productivity is rising by about 4 per cent per annum. Structural adjustment within the industry is occurring as a trend towards fewer but larger farms. The economy of the Crown/Pastoral Zone is based on grazing, mining, harvesting of timber (currently sandalwood and eucalypt burl).

Commercial enterprises are located primarily in the centres of Northam and Merredin. The tourism industry is growing in some areas, particularly in the 'Avon Arc'. Regional infrastructure is primarily to support the rural industries and communities. Towns, roads, rail and grain handling facilities were constructed in valley floor locations. These are the areas now at greatest risk to rising regional groundwater and salinity.