Conservation in a dynamic setting requires understanding the factors leading to landscape change. This study integrated traditional remote sensing and geographic information systems analysis techniques with a narrative policy analysis to assess the 1975–2004 land cover changes and their determinants in Nam Dong district (central Vietnam). Total forest cover of Nam Dong remained stable, but there were major transitions within forest and non-forest categories. Recent policy initiatives, particularly forest land allocation, have resulted in short-term benefit maximization through land speculation and illegal logging, while increased awareness of the economic potential of forests and their products have motivated people to access forests more frequently, leading to a highly dynamic landscape and increased barriers to forest conservation. This study suggests that (1) state-sponsored logging needs to be reduced, (2) forest allocation should proceed more rapidly to give farmers better incentive to improve and protect allocated forests, and (3) small-scale industry should increase. Forest conservation policy must be amended. More research is needed to link household land-use choices with policies, and determine how those choices lead to changes in the landscape.