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In the last three decades, self-governed robust institutions and design principles were emphasized for effective management of the commons including forests. However, little attention was given to institutional change and institutional performance. This paper addresses the relationship between institutional change and institutional performance under decentralized forest management (DFM) in Babati District, Tanzania. It is demonstrated that both constitutional and operational changes occurred under DFM in Babati. Institutional changes were found to be associated with improved condition of forest resources, good governance and sustainable livelihoods. However, cash income accrued from forests under DFM did not improve. Theoretically, a framework of multiple institutional logics of action was found more capable of explaining institutional change and institutional performance than Ostrom's rational choice institutionalism and design principles. Inglés