Many of the large, donor-funded community-based conservation projects that seek to reduce biodiversity loss in the tropics have been unsuccessful. There is, therefore, a need for empirical evaluations to identify the driving factors and to provide evidence that supports the development of context-specific conservation projects. We used a quantitative approach to measure, post hoc, the effectiveness of a US$19 million Integrated Conservation and Development Project (ICDP) that sought to reduce biodiversity loss through the development of villages bordering Kerinci Seblat National Park, a UNESCO World Heritage Site in Indonesia. We focused on the success of the ICDP component that disbursed a total of US$1.5 million through development grants to 66 villages in return for their commitment to stop illegally clearing the forest. To investigate whether the ICDP lowered deforestation rates in focal villages, we selected a subset of non-ICDP villages that had similar physical and socioeconomic features and compared their respective deforestation rates. Village participation in the ICDP and its development schemes had no effect on deforestation. Instead, accessible areas where village land-tenure had been undermined by the designation of selective-logging concessions tended to have the highest deforestation rates. Our results indicate that the goal of the ICDP was not met and, furthermore, suggest that both law enforcement inside the park and local property rights outside the park need to be strengthened. Our results also emphasize the importance of quantitative approaches in helping to inform successful and cost-effective strategies for tropical biodiversity conservation.