Evidence suggests differential impacts of community development, including gentrification and displacement. Public health practitioners and advocates are key stakeholders involved in the community development process related to active living, yet little is known about their perceptions of its impacts. We explored the perspectives of relevant leaders of public health departments and key community and advocacy organizations on community development, gentrification, and displacement. Purposive key informant interviews. CDC State Physical Activity and Nutrition (SPAN) funding recipients. CDC SPAN recipient leadership (n = 10 of 16) and advocacy organizations they partnered with (n = 7 of 16). Interviews were recorded, transcribed, coded, and thematically analyzed with direct quotes representing key themes. Both groups felt community development held important benefits, specifically by creating healthy living opportunities, but also potentially leading to the displacement of long-time residents. Practitioners reported the benefits were for all community members, whereas advocates noted the benefits were seen in those with privilege, and the consequences were disproportionately seen in disadvantaged communities. Both mentioned the importance and difficulty of getting diverse representation for community engagement. Learning how key stakeholders perceive and navigate the community development process can help inform recommendations for better equity in active living community improvements. More work is needed to further elucidate best practices for health and social equity in the community development process.