There is a need to bring to fore the contribution of indigenous institutions in promoting peace building, fostering co-operation and collaboration among settled Fulani Agro-pastoralists in communities of Ogun State, Nigeria. The leadership institutions in pastoral communities were found to be involved in the process of investigating and resolving conflict as well as making authoritative decisions in respect of land access and sustainable use of natural resources management. Sustainable access to land resources and use for cattle and crop production in pastoral communities is dependent on the prevalence of strong local institutions for collective action (cooperation and collaboration). Purposive sampling technique was used to select 435 respondents. Data were collected using semi-structured Interview Guide. Fulani respondents maintained that some of the challenges facing them were loose collaboration/contradiction between statutory and indigenous institutions, intrusion of migratory pastoralists (Bororo), illegal entry of new herders, lack of policy support by government to settle conflict between Fulani agro-pastoralists and others constitute collective action problems and challenges. Spearman correlation analysis revealed that there were significant relationships (p<0.01) between available local rules (r=0.252), utilised leadership institution (r=0.234) and conflict management. The study concludes that local institutions for building collective action in the management of conflict and water pollution such as Sarkin Fulani, Mawdo and Jawmu saare embedded with tradition (aldu), laws (doka) and justice (sharia) are important for the maintenance of peace and sustainable land resources among the Fulani pastoralists. It is recommended that leadership training in monitoring, enforcement and sanctions be provided to settled Fulani agro-pastoralists, host Yoruba farmers and migrant farmers.