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Despite efforts to establish protected areas around the world, the authority of government remains weak in forested areas. This paper examines the largest protected area in Central America, Bosawas National Natural Resource Reserve in Nicaragua, to demonstrate how overlapping systems of governance have encouraged rapid ecological destruction and social differentiation, as well as corruption and violence. The paper traces the history of the Bosawas to illustrate these points. It covers the period until 2001. It concludes that Migdal’s observation about forest governance as being guided by ‘strong societies and weak states’ (1988) is unlikely to change and must be the starting point for future efforts in decentralized natural resource management.