The Community Forestry programme was formally launched in Nepal in 1978 with the enactment of the Panchayat Forest Rules and the Panchayat Protected Forest Rules. The Community Forestry policy along with Community Forestry legislation has been continuously reformed over time. These reforms have recognized the use rights of the local people in the management of forest resources and established them as managers. Since the inception twenty-four years ago the progress in policy shift has been tremendous. However, the actual implementation is still slow in pace. This paper aims to review and analyse the policy changes during this period and discusses the constraints and opportunities provided by the Community Forestry programme in Nepal.