Diversification of income in financial management is key to organizational development and sustainability in the 21st Century. The purpose of this study was to investigate the role of income diversification on organizational development and sustainability among Catholic women religious congregations in Nairobi Archdiocese, Kenya. The study was grounded on Resource Dependency theory and adopted a descriptive research design. The population of the study was 3,000 women religious from which a sample of 97 was drawn using Simple Random Techniques. The study established that income diversification affects sustainability of Congregations to a great extent and therefore other income generating activities are helping to increase congregations’ financial sustainability. The declining foreign donations are pushing many Congregations to invest in income generating projects as source of funding and for self-reliance and sustainability purposes. The study recommends that the management of Women Religious Congregations have an obligation to ensure that their communities are able to sustain themselves through self-reliance and good financial management practices. Study key terms: Income diversification, Sustainability, development, women religious congregation