More than one million smallholders in the Andean region of central South America exploit alpacas (Vicugna pacos) and lamas (Lama glama) as their main means of subsistence. Alpacas and lamas provide meat, milk, fibre, power and guano; in addition it is an important element of the cultural identity of their producers. With 3.9 million lamas and 3.3 million alpacas the total annual fibre production in the region exceeds 5 million kg. Nearly 30% of the fibre production is transformed on-farm or at the community level. About 80% of the marketed alpaca fibre is white and 12% is finer than 23 microns. Lama fibres have less value and are more variable in colours and fibre diameter than alpaca fibres. Both species of camelids have two breeds, each one with specific adaptation and fibre quality characteristics. Two wild species of camelids exist in South America: the guanaco (Lama guanicoe) and the vicuna (Vicugna vicugna). Both have fleeces with precious down fibres. Specific populations of these camelids are qualified to be captured, sheared and released, providing an additional income to the communities in which they live. Due to support to improve the production of fibre and other products of South American camelids, while preserving a valuable animal genetic resource, the cultural values of the associated production systems, and improving the livelihoods of resource-poor smallholders should be part of a global strategy involving a sustained investment in appropriate R&D.