In this paper we present a segmentation algorithm, inspired from an image-processing region-merging algorithm, for the delineation of discrete contiguous management zones in agriculture. The algorithm is unique in that it is applicable to high- or low-density irregular data sets, such as yield data. The algorithm is described and a brief example. presented using unprocessed sensor-derived grain yield data. A comparison between the segmentation algorithm and a common classification algorithm (k-means clustering) was done using an aerial normalised differences vegetation index (NDVI) image collected on a 200 ha vineyard in Olite, Southern Navarre, Spain. Classification was performed as a univariate (NDVI) analysis and a spatially constrained analysis. Segmentation and classification were run to find 2, 4, 6, ..., 24 levels and the effectiveness of the outputs determined by how well it explained the variance in vine trunk circumference, a correlated but independent measurement. The results obtained demonstrated that for a given number of manageable (effective) zones the segmentation outputs were equivalent or superior to the classification outputs for partitioning vine circumference variance. The segmentation output also generated more coherent management units that should facilitate differential management. The algorithm presented is a first generation segmentation algorithm and several aspects still need to be developed, in particular methods for eliminating edge effects and converting management zones into management (treatment) classes. The results of the segmentation algorithm presented here would indicate that with further development, segmentation might provide an alternative and possibly preferable approach to delineating management zones