This paper investigates how sustainable forest management is addressed within the legal tools and the institutional framework in Portugal, and proposes a methodology for enhancing stakeholder participation in forest management. Portuguese forest policy is dealt with at the national level, incorporating the international and European guidelines. Based on a review of relevant policy documents and legislation, three key-principles towards sustainability were identified according to the national context: the prevention and mitigation of forest resources threats; the enhancement of the full value of forests; and the promotion of stakeholder participation in forest policy-making. The analysis demonstrated that most of the principles coming from the supra-national agenda are already included in the national forest policy. Nevertheless, stakeholder participation in forest policy-making in Portugal has been very limited. This is reflected in a poor implementation of forest policies, leading to the need for developing innovative participatory methodologies able to promote collaboration among all relevant stakeholders.