Karnali region i.e. province no 6 of federal Nepal is a treasure house of wide range of biological resources, cultural heritage and diverse natural landscapes. Diversity and uniqueness have made the region as one of the most important tourist destination and biodiversity hotspots in Nepal. The region has protected areas with global significance also. The people of Karnali region are on the way to improve their quality of life by conservation and utilization of available natural and cultural resources through their active involvement in development planning and implementation. However, region’s existing socio-economic scenario and environmental situation demand an integrated development initiation which integrates environment, economic, social and cultural spectrum of the area for better understanding the dynamics of these four pillars of sustainable development with pragmatic solutions. Participatory natural resources management efforts could be effective development model to address the aspirations and sustainability in mountain areas. This development model could play important role in identifying resources, defining development priorities, adapting technologies and implementing practices. Further, the participatory approach can encourage local to participate in their resources conservation, utilization and management for improving livelihood in sustainable way. In this context, the main focus of the paper is to identify the current situation of the level of the natural resource management, assess the influent factors of people’s participation in the natural resources management, analyze the strengths and weakness of people’s participation in term of conservation, and sustainable use of natural resources in the Karnali areas. The issues discussed in this paper clearly indicate that there is urgent need to promote the community participation on environment and development for the proper links between population, development, technological implication and institutional strengths, using a micro level conservation and development model that suits local environments. The paper suggests that both central and local governments adopting people-public-private- partnership (p4) have to join hands with an effort to improve infrastructure, productivity of economic activities, tourism development and management of settlements in order to promote the quality of human life with ecological stability in the region.