This paper analyses the environmental, socioeconomic and cultural impacts of oil palm development in the Prafi Plain of Manokwari District in West Papua Province. This analysis is based on interviews and focus group discussions conducted in January-August 2011, a literature survey, and analysis of Landsat images of the region. The research findings indicate that oil palm cultivation brings significant benefits-such as infrastructure development, higher incomes for local stakeholders and broader opportunities for customary communities. However, the large number of immigrant workers brought in to work on the plantation estate are a source of conflict with the local population. Oil palm development has had adverse environmental impacts as it has resulted in the deforestation of about 60% of the Prafi watershed. It has also caused soil erosion, poor water quality and air pollution. To avoid additional adverse impacts, the development and expansion of oil palm estates should focus on replanting old plantation areas with high-yield varieties and planting on non-forested and degraded land. Special land zones should be set aside for the indigenous Arfak people to use for subsistence farming. Additional efforts should be made to ensure that local communities receive proper compensation for the loss of use of their traditional lands. Increasing transparency in land allocation, stricter supervision of plantation operations and sanctions for non-compliance with sustainability standards are of utmost importance.