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The current proposals on reducing emissions from deforestation and forest degradation in developing countries being discussed under the UN Framework Convention on Climate Change (UNFCCC) could have significant implications for biodiversity conservation and for forest-dependent livelihoods. In the post-2012 period, developing countries could receive financial benefits in return for decreasing their greenhouse gas emissions from deforestation and forest degradation (REDD). Protected areas can act as a case study for REDD: lessons can be learnt from their success or otherwise in reducing deforestation and supporting local livelihoods. Depending upon the exact mechanisms decided between and within countries, protected areas could have a role to play in reducing national-scale deforestation, through strengthening existing forest protected areas and/or declaring new areas. Overall, protected areas are effective at limiting deforestation, but there are exceptions. Their track record in supporting livelihoods is more variable. The early indications are that community-managed and indigenous reserves are often effective in achieving both goals, but that biodiversity conservation is not necessarily such a high priority within these areas. Further research into the most effective management and governance frameworks for achieving goals on carbon emissions, biodiversity and communities, and the extent to which protected areas reduce (or merely displace) deforestation within national boundaries would be useful in informing REDD implementation.