Community forestry offers potential for socioeconomic benefits while maintaining ecosystem services. In Mexico, government and donor efforts to develop this sector focus on issues within forest communities. Often overlooked are effects of external non-government actors (NGOs and foresters) as links or barriers between communities and funding, capacity building, and technical support. To analyze the role of these actors, I analyze household survey and interview data from 11 communities with varying levels of vertical integration of forestry production in states with divergent records of community forestry, Oaxaca and Michoacán. Results suggest that strong community governance is necessary but not sufficient for vertical integration, and strong interactions with non-government actors are critical. These actors, operating within the existing framework of government regulations, have a range of incentives for engaging communities. Availability of these actors motivated by concern for community capacity instead of timber income may be a determinant of community forestry development.