This paper examines the nature of community management of woodlots and investigates the determinants of collective action and its effectiveness in managing woodlots, based on a survey of 100 villages in Tigray, northern Ethiopia. Despite limited current benefits received by community members, the woodlots contribute substantially to community wealth, increasing members' willingness to provide collective effort to manage the woodlots. We find that benefits are greater and problems less on woodlots managed at the village level than those managed at a higher municipality level, and that the average intensity of management is greater on village-managed woodlots. The factors that do significantly affect collective action include population density (higher collective labor input and lower planting density at intermediate than at low or high density), market access (less labor input, planting density and tree survival where market access is better), and presence of external organizations promoting the woodlot (reduces local effort to protect the woodlot and tree survival). The finding of an inverse U-shaped relationship between population density and collective labor input is consistent with induced innovation theory, with the increased labor/land ratio promoting collective effort to invest in resources as population density grows to a moderate level, while incentive problems may undermine collective action at high levels of population density. These findings suggest collective action may be more beneficial and more effective when managed at a more local level, when the role of external organizations is more demand-driven, and when promoted in intermediate population density communities more remote from markets. In higher population density settings and areas closer to markets, private-oriented approaches are likely to be more effective.