This is a study about government land policies and their impact on land utilisation and management and on land degradation. Land policies in Nepal were, in general, found to have a negative impact on the majority of the population and to cause land degradation. It is a mutually reinforcing process in which degradation has aggravated poverty and poverty has further exacerbated degradation. A review is first made of the overall national framework for guiding development efforts with due regard given to sustainability and maintenance of the environment. The various perspectives on land degradation are discussed and five key areas of concern selected for this study (agriculture, property and entitlement, forestry, national parks and wildlife, and decentralisation are analysed). Performance in the country's leading economic sector, agriculture, is found to be unsatisfactory, while achievements in forestry and protected area management are mixed. Land ownership and tenure entitlements are unfavourable from both equity and efficiency perspectives. Finally, while there has been considerable rhetoric regarding participatory and bottom-up processes of resource management and decision-making, empowerment of local bodies through decentralisation remains inadequate.