The present article examines the causes of deforestation in southwest China on the basis of listening to peasants' own descriptions of their role in illegal timber cutting. It finds that a sense of “relative deprivation” amongst China's rural poor has encouraged poor environmental management. Peasants justify illegal tree cutting by pointing to China's rapidly increasing inequalities, their lack of economic opportunity, and the absence of economic support from the (corrupt) government. These issues, combined with continuing institutional problems with forest management after decollectivization, convince peasants that ignoring environmental conservation edicts and cashing in on their trees is a good choice. This study identifies relative poverty and social discontent as major factors driving deforestation.