Intercropping has become an interesting method to increase the utilization of land and engender income diversification among smallholder horticultural producers especially in constrained resource settings. The paper assessed the economic and agronomic performance of basil ( Ocimum basilicum L. ) when intercropped with tomato ( Solanum lycopersicum L. ) under homogeneous (Mediterranean) environmental conditions in the north of Greece. The treatment was set up as three treatments, monoculture tomatoes, monoculture basil, and tomato-basil intercropping within alternate rows. Intercropping in this case produced Land Equivalent Ratio (LER) of 1.38 showing better land-use efficiency in comparison with monocultures. Although the tomato yields per plant when intercropped were slightly lower (-5.3 %), the general profitability and productivity had been improved to a large extent. In the intercrops, basil productivity was higher and there was a general 22 percent elevated gross revenue per acre in the intercrops as compared to the monoculture practices. Moreover, the intercropping system led to the increase in the water-use efficiency meaning that the resource can be optimized. These results give the tomato-basil intercropping system a prospect of being a sustainable and economically feasible system to Mediterranean horticulture with environmental and economic advantages to the smallholder farmers.