The implementation of the decentralisation policies in Indonesia, which started in 2000, has fundamentally changed the country’s forest governance framework. This study investigates how decentralisation has influenced forest governance, and links the forest governance to deforestation rates at the district level. We measure and compare the quality of forest governance in 11 districts in Central Kalimantan province in the periods 2000-2005 and 2005-2010 and relate forest governance to deforestation rate. This study shows that decentralisation has led to marked differences in forest governance between districts and that deforestation rates is strongly related to the change of forest governance. We recommend revisiting the Indonesian forest governance framework to ensure more checks and balances in decision making, better monitoring and increased transparency, with particular support for Forest Management Units as a new tool for forest management, and government support to facilitate the design and implementation of REDD+ projects.