Rangelands cover more of the earth’s land surface than any other type of land. In Africa, it is estimated that rangelands cover about 40% of the land mass, and are home to approximately 30 million people who practice pastoralism or agro-pastoralism as their primary livelihood. Despite the image of the “pure” pastoralist, who only depends on his or her livestock, most pastoral households throughout Africa have diversified economies that include cultivation and labor migration. Much of the recent literature on pastoral communities examines the processes and consequences of this diversification, but with the exception of the privatization of rangelands in Kenya, there has been little written about how the combination of livelihood diversification and policy changes impact the transition of informal institutions to formal institutions in the African rangelands. In this paper, I use a case study from northern Tanzania to examine this process and address some of the environmental and social consequences of this transition.