Introduction Being the fifth largest country in the world both in terms of geographical size and population, Brazil epitomizes the ongoing global tension pitying biodiversity preservation against agricultural sustainability and economic development. Available statistics demonstrate that Brazil is a critical emerging economic power with a GDP of US$604.0 billion and a GDP per capita of US$3,326.21 in 2004, and that the country’s environment is one of the richest in the world not only because its fauna and flora is found nowhere else on earth, but also due to the fact that its ecosystems contain in excess of 15 percent of the plant and animal species known to science (European Commission, 2007). Holding up to 12 percent of the available freshwater worldwide, the country is undoubtedly one of leading producers of food and biofuels in Latin America and globally (Ferreira et al., 2012). But while Brazil continues to play an increasingly important role in the global challenge to supply food to a growing and more affluent human population through agricultural expansion activities, hence driving rapid economic development, available literature demonstrates that such events have also had significant adverse impacts on biodiversity and the conservation of ecosystem services in the country (Ferreira et al., 2012). This paper borrows from Ascher and Healy’s (1990) concept of vicious cycle to demonstrate how Brazil may be sucked into the vicious cycle, entailing economic production, the environment, income distribution and resources, if policies are not put in place to address adverse impacts caused by agricultural expansion. Understanding the Vicious Cycle & the Brazilian Problem In their influential reading, Ascher and Healy (1990) employ the vicious cycle metaphor, which essentially is a circular constellation of forces tending to act and react upon one another in such a manner as to keep a poor country in a state of poverty, to demonstrate the complex interrelationships among four critical facets of sociophysical production namely economic production, distribution of income, natural resources, and the environment. In the four key attributes, economic production is described as the level, source, and composition of the goods and services generated by the economy at any point in time, while income distribution is perceived as including functional distribution, size distribution among recipients of diverse income levels, distribution of in-kind income such as government services or gratification from environmental quality, as well as regional income distribution. Likewise, natural resources have been described as a broad assortment of substantial natural endowments such as land, water, timber and minerals, while environment refers to the natural systems that provide the background or surroundings for human activity (Ascher & Healy, 1990). Unlike other less advanced and developing countries, Brazil is on the verge of achieving long-term economic development that is partially fuelled by effective exploitation of natural resources (Ferreira et al., 2012), which not only include “the dense tropical rainforests of the Amazon, but also the important biomes of the Savannah-like Cerrado, the arid scrublands of the Caatinga, the Atlantic Forest, the grasslands of the Pampa and the wetlands of the Pantanal” (European Commission, 2007 p. 11). Reports released by The Economist (2010) and Food Agriculture Organization (2012), cited in