Long-term human impacts are considered to be the prime cause of unsustainable forest exploitation in Ethiopia. Yet there exist well-established systems and a wealth of local experience in maintaining and managing forests. This study explores the trends and driving forces of deforestation plus traditional practices regarding sustainable forest use and management in the Chencha and Arbaminch areas, Southern Ethiopia. Satellite image analysis (images from 1972, 1984 and 2006) combined with field surveys were used to detect and map changes in forest cover. Household interviews and group discussions with experienced and knowledgeable persons were also employed. The results show a 23 % decline in forest cover between 1972 and 2006 with the most significant change from 1986 to 2006. Change was greatest in the lowlands and remarkable episodic forest changes also occurred, suggesting nonlinear spatial and temporal forest cover dynamics. According to farmers, the main driver of deforestation is agricultural land expansion in response to local population increases and a decline in agricultural production. Growing local and regional fuel wood demand is another chief cause. Despite these issues, remarkable relicts of natural forests remain and trees on farmland, around homesteads and on fields in every village are basic elements of farm activities and social systems. This demonstrates the effect of cumulative traditional knowledge and long-term local experience with forest management and preservation. Therefore, these practices should be promoted and advanced through the integration of local knowledge and forest management practices in the design and implementation of sustainable environmental planning and management.