Over the past few decades, Participatory Forest Management (PFM) has emerged as a key strategy internationally. Following the recognition that centralized and expert-dependent forest management practices have been unsuccessful in halting deforestation, the government of Ethiopia, with assistance from international donors, has been implementing PFM pioneer projects since the early 1990’s. The experiment is based on the assumption that participation of local communities, which are the major stakeholders using the forest resources, is essential for reversing the de facto open access to forests. The PFM pilot projects have used a diversity of implementation strategies, however, that need to be evaluated before a national PFM strategy can be formulated. The present paper conducts an evaluation of the institutional set up and the outcomes of seven pioneer old PFM sites distributed in Oromia and Southern Nations Nationalities and People Regional states. Outcomes are assessed as forest users’ perceived changes (before and after pioneer projects) in (1) ownership feeling over the resource (2) change in forest condition (3) change in livelihood of members, and (4) stability of the PFM institutions. Qualitative data was collected in focus group discussions, semi-structured and key informants interviews. Our findings indicate that in most sites the forest cover and ownership feelings of the community have improved after introduction of PFM. Post project assessment, however, shows that weak law enforcement, revocation of PFM agreements by the government, high project staff turnover and inequitable forest benefit distribution endangers the sustainability of PFM in Ethiopian pioneer projects. The paper argues that scaling up PFM without consideration for these issues risks multiplying mistakes.