The goal of the Programme for Sustainable Development in Rural Mountain Areas of Albania was to increase household incomes through three objectives: additional resource mobilization in and for the mountain areas; accelerated economic growth and poverty reduction; and strengthened abilities of local institutions to support private- and public-sector investment. The project was able to identify relevant value chains and key constraints to enhancing incomes. Experiences in community empowerment and institutional development were also promising at local level. Some farmers and entrepreneurs successfully used project grants or loans to expand their operations, resulting in higher incomes and the creation of jobs. However, the project did not meet expectations at the national level. In particular, an effective mountain area development agency has not emerged, nor has a sustainable rural lending institution serving small rural farmers or entrepreneurs. The project design did not adequately take into account critical issues and recommendations raised during a former evaluation by IOE and IFAD design reviews. A lack of an appropriate monitoring and evaluation system and the absence of a midterm review limited corrective measures that could have been introduced.