Global concerns about the need to conserve marine ecosystems have resulted in rapid&nbsp;growth in the establishment of formally protected marine conservation areas. The&nbsp;ecological benefits of marine protected areas (MPAs) are relatively well recognised,&nbsp;however, the extent to which MPAs improve the livelihoods of coastal peoples remains&nbsp;subject to debate. The aim of this research was to assess the potential impacts of the&nbsp;establishment of an MPA on coastal communities on Pantar Island, located in Nusa&nbsp;Tenggara Timur Province, in the eastern region of Indonesia. A subsidiary aim was to&nbsp;make practical recommendations that would minimise the negative impacts of an MPA&nbsp;and optimise the benefits for local people.An assessment of Indonesia&rsquo;s experience in establishing MPAs shows that community&nbsp;participation in the planning processes was encouraged but not comprehensive. Socioeconomic&nbsp;issues and concerns of communities have also not been adequately considered.&nbsp;Application of a sustainable livelihood analysis framework demonstrated that marinerelated&nbsp;activities were a major part of the diversified livelihood portfolio of coastal&nbsp;communities in and around Pantar Island. In addition, a wide range of activities were&nbsp;undertaken by the coastal villages to survive and cope in vulnerable conditions. Value&nbsp;chain analyses mapped selected marine products and identified the importance&nbsp;of seafood for food security of Pantar Island and income, how local communities are part&nbsp;of international market networks and ways to enhance the participation of local&nbsp;communities in the market. The research found that an MPA would potentially have&nbsp;negative short and long term impacts on coastal livelihoods which included changes to&nbsp;the level of coastal use, displacement of people from fishing areas, loss of access and&nbsp;rights to resources, and reduction in household income. Opportunities for strengthening&nbsp;livelihoods were identified. The research demonstrates the need for future MPA&nbsp;initiatives in Indonesia to improve the balance between conservation goals and&nbsp;livelihood outcomes