The Cambodian government introduced a dramatic reform in 2001 that reduced the allocation of commercial fishing lots in favor of local community access. Hailed by community activists, the policy shift nevertheless accelerated a crisis in the sector, with effectively open access and very poor law enforcement leading to intense exploitation and a surge in illegal fishing. This essay reviews the context and the content of the reform initiative, the preliminary outcomes and many challenges faced in its implementation, and the lessons for other developing countries aiming to support community-based management in fisheries or other natural resource sectors. Building the organizational capacity of community institutions is inadequate if not complemented by efforts to improve governance by establishing appropriate legal authorities and rights, strengthening the accountability of public officials, and removing barriers to the economic viability of community management.