To enhance local participation in forest protection and sustainable development in Bach Ma National Park, Thua Thien Hue Province, Vietnam, a benefit sharing mechanism (BSM) based on principles of co-management has been piloted. This study aimed to evaluate socio-economic impacts of this pilot on people living in seven targeted villages of Thuong Nhat Commune, Nam Dong District, Thua Thien Hue Province after two years of implementation. Evaluation methods were household interview, in-depth interview, village meeting, focused group discussion and workshop with stakeholders at commune level. Results showed that: (1) the local community was strongly supported and involved in the BSM implementation, displaying a high level of demand for the measures; (2) local people’s awareness of rights, responsibilities, forest protection and sustainable use of non timber forest products (NTFPs) has increased considerably; (3) the policy has also enhanced the awareness and participation of local people in cooperation with the park rangers to co-manage the forest. Additionally, this study provides a number of suggestions to improve the BSM, including: (1) raising local people’s awareness; (2) simplifying BSM procedures; (3) clarifying incentives and responsibilities of BSM actors to enhance co-patrolling and monitoring activities; (4) creating good incentives either based on the livelihood program for those who actively comply with the BSM regulations or direct payments to those who join forest-protection activities.