Most global strategies for future food security focus on sustainable intensification of production of food and involve increased use of nitrogen fertilizer and manure. The external costs of current high nitrogen (N) losses from agriculture in the European Union, are 0.3-1.9% of gross domestic product (GDP) in 2008. We explore the potential of sustainable extensification for agriculture in the EU and The Netherlands by analysing cases and scenario studies focusing on reducing N inputs and livestock densities. Benefits of extensification are higher local biodiversity and less environmental pollution and therefore less external costs for society. Extensification also has risks such as a reduction of yields and therewith a decrease of the GDP a...