This article aims to contribute to effective climate change adaptation (CCA) in Indonesia. Located in a volatile extreme weather region, it is the largest archipelagic country, and is among the five countries with the highest number of natural disasters. Although Indonesia signed the Kyoto Protocol in 1998 and ratified it in 2004, CCA remains embryonic despite recent changes to facilitate climate policy. Problematic areas include inadequate sectoral policy coordination across government agencies and jurisdictional levels, and inadequate local capacity building. This article addresses these areas both because Indonesia has to date paid little attention to them and because of their significance to other developing countries. To achieve a better understanding of the inadequacies to inform learning and development on CCA policy, a policy analysis was conducted that included 25 interviews with Indonesian policy actors. Key findings are that for effective adaptation, sectoral coordination needs to first address a number of inadequacies in governance and practice inadequacies to facilitate local mainstreaming of adaptation. In turn, local capacity building needs to address inadequacies of resource support, leadership, climate change awareness, government–community partnerships, vulnerability assessment, and inclusion of local knowledge and communities in decision-making.