In Nigeria, extreme climate conditions, such as droughts and erratic rainfall, increasingly threaten maize production, a crucial crop that is fundamental to food security and rural livelihoods. This study investigates the marginal returns of regenerative agriculture (RA), a collection of practices aimed at restoring soil and enhancing resilience, on maize performance under these conditions, exploring its potential as a sustainable production paradigm. Using a multistage sampling approach, data were collected from smallholder maize farmers in Southwest Nigeria via structured questionnaires, capturing socioeconomic characteristics, RA practices, and maize yield outcomes. The analysis employed a Marginal Treatment Effect (MTE) framework to assess heterogeneity in RA’s impacts, complemented by Seemingly Unrelated Regression (SUR) and robustness checks to estimate effects on yield, yield variability, and skewness. Results reveal that RA adoption boosts maize yield and reduces variability for adopters, with potential benefits for non-adopters, though average effects (ATE) are modest. Yield skewness increases for adopters, suggesting higher chances of greater yields. The MTE analysis highlights that benefits concentrate among farmers with low unobserved resistance (adaptability), while high-resistance farmers face reduced returns. Key adoption drivers include land ownership, credit access, and climate change perception, yet barriers like labor intensity and awareness gaps slow diffusion. These findings imply RA can enhance resilience and productivity in Nigeria’s climate-stressed maize sector, but its success is context-specific, requiring targeted policies such as improved credit access, extension services, and tenure security to overcome adoption hurdles and ensure equitable, scalable impacts.