The debate over peace in Sudan has centred on the ongoing talks in Naivasha, Kenya. This paper argues, however, that sustainable peace is not simply a function of the implementation of an agreement between the SPLA and Khartoum, but that other fracture lines will run through post-conflict Sudan. Here we draw attention to the rupture between the Dinka, dominant within the SPLA, and the Equatorian peoples of the far south, hundreds of thousands of whom were driven from their homes or faced with economic and political oppression under SPLA occupation. As these refugees return, it will be through local government structures that Equatorians will or will not be integrated into the SPLA political project for Southern Sudan. Thus, local government figures prominently in the possibility for sustainable peace. We describe the origins and structure of local government in Southern Sudan, situating it in the history of political tension between Dinka and Equatorians. We then describe the challenge of equitably distributing land and foreign aid to returnees in the context of ethnic politics and a massive NGO presence.