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Violent conflicts are generally perceived as a destructive and negative phenomenon, with little understanding of how they also offer opportunities for positive change. In particular, there is very poor understanding of how conflicts and development interventions and processes interact with each other to create far-reaching positive changes in institutions and practices. This article looks at the interactions between development processes and conflicts by taking the community forest user groups (CFUGs) in Koshi hills in Nepal. Drawing on the authors' experience as development professionals of the Livelihoods & Forestry Programme (LFP), it demonstrates that the Maoist conflicts in several ways contributed to enhance the outcomes of pro-poor development actions. We show that the conflict has helped to empower the voices of marginalized groups, improved their access to community forest resources, and advocated and brought about changes in local policies and institutions of the CFUGs in favour of equitable resource management. Its findings challenge the conventional wisdom that conflicts are always negative and that they obstruct development processes. The lessons that can be taken forward in the current conflict situation is that development actions can have better outcomes if accompanied by local level resistance in support of the poor and marginalized groups.