This article seeks to shed new light on the study of decentralized natural resource governance by applying institutional theories of polycentricity—the relationships among multiple authorities with overlapping jurisdictions. The emphasis on multi-level dynamics has not penetrated empirical studies of environmental policy reforms in non-industrial countries. On the contrary, many of today’s decentralization proponents seem to be infatuated with the local sphere, expecting that local actors are always able and willing to govern their natural resources effectively. Existing studies in this area often focus exclusively on characteristics and performance of local institutions. While we certainly do not deny the importance of local institutions, we argue that institutional arrangements operating at other governance scales—such as national government agencies, international organizations, NGOs at multiple scales, and private associations—also often have critical roles to play in natural resource governance regimes, including self-organized regimes.