Participatory forest management is credited for supporting social learning processes and fostering capacity of forest users for collaboration and collective actions. Despite more than a decade of practice, the empirical evidence substantiating the contribution of participatory management for the capacity development of forest users is scarce. This study assesses a participatory forest management program in Madhupur Sal forest, Bangladesh, by comparing the capacity of de-facto groups of participants and nonparticipants and identifies factors that influence the capacity development. Data were collected using a mixed method approach which combines both qualitative and quantitative methods of data collection. Results indicate that participants differed from nonparticipants significantly in terms of various capacity dimensions related to collective actions. Extension services, credit support, trust within society, information and communication influence the level of capacities in tribal population to adapt and respond to changes. The initiatives to manage natural resources are likely to be more successful if the forest management program initiators consider several factors that influence the capacity development of resource users.