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Policies aimed at the exclusion of local communities from forest management are inappropriate, especially in a densely populated area with a low level of land ownership. Here we demonstrate that termination of the Tumpang Sari program, which allowed local communities access to areas for controlled cultivation in several parts of the state forest area in West Java, Indonesia, did not cease illegal cultivation of the forestland. Moreover, illegal cultivation continues to be conducted by many people. This has created not only a land degradation problem but also has affected other forest resource users, the fuelwood collectors and the dairy cattle farmers. Therefore, the re-involvement of local communities in better forest management is required to avoid further environmental degradation as well as enhance poverty alleviation programs.