The study presented in this chapter identified the factors associated with the success and failure of agricultural cooperatives in the liberalized Kenyan rural economy in which government withdrew the administrative and financial support it had previously offered cooperatives and devolved governance authority to cooperative members. It is revealed that the retreat of government resulted in a legal and regulatory vacuum that adversely affected the performance of many cooperatives and facilitated exploitative behaviour on the part of some unscrupulous members and business associates. Furthermore, a lack of general understanding among the membership of the business of running a cooperative left some with a dearth of management, accounting and marketing skills necessary to compete effectively. The experience of decentralization of control over cooperatives was not uniformly negative, however, as some evolved in response to the changing environment and seemed to thrive, delivering good value to their members. Successful cooperatives were generally characterized by a well-educated and skilled management committee, and transparency, accountability and responsiveness of the management to the members at large.