Joint Forest Management (JFM) is an institutional arrangement considered to be a proper way forward for alleviating forest degradation. However, since the inception of JFM in Amani Nature Reserve (ANR), its impacts to the forest resource base and livelihoods of surrounding communities is not clearly known. Therefore the study assesses the impacts of JFM on both forest resource base and livelihoods of the local communities around ANR. Forest inventory was carried out by laying out 30 sample plots systematically. In the plots, diameter at breast height and heights of all the trees were measured, recorded and tree species were identified. Livelihood attributes were collected using a questionnaire, checklist for key informants and a number of PRA techniques. To assess impact, both inventory and livelihoods data were compared between 2001 and 2005. Microsoft Excel Software was used to analyse quantitative data for various forest parameters. Data collected during PRA were analyzed with the help of the local community. Content and structural-functional analyses were applied to analyse socio-economic qualitative data. Statistical Package for Social Sciences (SPSS) was used to analyse the socio economic quantitative data. Logistic regression analysis model was developed to identify socio- economic factors influencing participation of local communities surrounding ANR in JFM. The study found that 3043 ± 360 (SE) stems per hectare were obtained in 2005 compared to 1762 ± 225(SE)) of 2001 indicating significant increase (t = 3.09; p=0.004) though, dominated by small diameter class of 2.5-10cm. The basal area and wood volume decreased suggesting that there was tree cutting in ANR. Species diversity indices increased from 3.271 to 3.379 between 2001 and 2005 indicating that the forest is still facing human disturbance. Training sessions in JFM, tree planting, income shared from forest under JFM and engagement of household in economic groups significantly (p<0.05) increased the odds of participation of local communities by factors of 17.986, 45.894, 10.658 and 7.671 respectively. Household income and improved housing standards significantly (p<0.05) influenced JFM performance. Poor monitoring capability as an indicator of weaknesses in governance contributed to JFM to have negative impact on basal area and wood. The study observed a positive impact on livelihoods. The study among other things recommended improvement of in governance by ensuring transparency and clear responsibilities of Village Natural Resources Committees.