The role of local knowledge and innovations in managing forest biodiversity was investigated in Kilombero wetlands, Tanzania. The approaches used were review of secondary data, transect walks, discussions with key informants, focus groups (25 people per village) and household interviews of 10% of the total number of households for two villages namely, Kiberege and Katurukila. Villages are located adjacent to forests endowed with biodiversity, utilised for different purposes. The main socio-economic activity is agriculture, which accounts for 66.7% and 85.7% in Kiberege and Katurukila, respectively. A number of practices and innovations play a significant role in the conservation of forest biodiversity including, for example, participatory learning on conservation, formulating laws, planned collection and harvesting of forest products, replacement of local species and use of firebreaks to control fires. Some of the benefits accruing from forests include: (i) collection of fuel wood, timber and building materials; (ii) traditional medicines; (iii) collection of honey and other food products like mushrooms; and (iv) legal hunting of animals. The study recommends that the current existing innovative system in managing forest biodiversity should be strengthened. Cheap energy source also needs to be provided to the communities to reduce pressure on forest resources.