This thesis looks at the internal community processes set in motion by intervention in the context of the current community forestry policy of Nepal which has embarked on handing over local forest resources to local user groups. The overall aim of the thesis is to explore the question : How does intervention lead to certain types of effects through dynamics within the community? These processes have been something of a 'black box' so far. This research is based on fieldwork in adjoining forest user groups in the western hills of Nepal for nearly eight months starting from August 1994. The research examined the outcome of earlier interventions in these adjoining forest communities. An important finding of this study is that the nature of use rights is evolving and contestable rather than fixed. It is further argued that there may be inequitable outcomes in terms of cost and benefit sharing amongst households after forests are officially handed over. This is attributed to differing perceptions about the nature of equity. The poor do not necessarily get fair treatment despite provisions for equality of opportunity in Operational Plans. It is argued that inequitable outcomes do not, however, necessarily lead to non-compliance partly because the system, though inequitable, is based on at least a pseudo-democratic model rather than direct coercion. Intervention has a role. However, it is argued that effective intervention has to pay proper attention to attaining better use rights and better equity. The key to attaining better use rights is the need to appreciate the fact that use rights are contestable and dynamic by nature / Doctor of Philosophy (PhD)