Identifying the main sources of conflict and understanding the relationships between protected areas and local communities are critical to conflict resolution related to protected area management. We surveyed and assessed the perceptions of local people related to forest values of the Bulong Nature Reserve (BNR), Yunnan, China, and their attitudes toward forest management of the recently-established nature reserve. Factors influencing the differences in perceptions and attitudes were investigated. Our results indicated local residents preferred the economic value of forests, and they perceived more forest values after reserve establishment than before, especially for ecological services. Interviewees believed the value of the forests have increased, and predicted that the forest will have increased importance to their livelihoods and health in the future. Nonetheless, the majority of interviewees were dissatisfied with current reserve management. Variation in these perceptions and attitudes were related to several social variables: age, gender, education, and distance from the reserve. Embedding the findings of the present study, specifically the perceptions and attitudes of local people, into management guidelines for mitigation of potential conflicts is proposed and should help managers to achieve biodiversity-related goals. This study offers new insights related to the identification of the underlying sources of conflict in forest management and provides a better understanding of the relationship between local people and protected areas. The study also contributes to the literature on forest values of indigenous populations by examining those of remote, rural populations in China.