Effective monitoring is a fundamental requirement for adaptive management. The need for better tools for monitoring livelihoods is particularly acute. A simple indicators-based livelihoods monitoring tool to be used at the village scale was developed and tested. Participatory methods were used to elicit local perceptions and aspirations about development and conservation. That information was used to develop a prototype set of indicators, organized using the Sustainable Livelihoods Framework. Data were collected for the indicators in six villages to calibrate and test the tool. Indicators of financial and physical capital worked well. Social capital and natural capital were more difficult to capture with low-cost indicators. Most of the indicators are applicable in rural areas of the district and beyond. Despite some shortcomings, the tool shows good potential as a way to focus attention on key aspects of rural development and as a way to inform and facilitate discussion and negotiation between communities and other stakeholders.