Community engagement and local governance are important components of health interventions aiming to empower local populations. Yet, there is limited evidence on how to effectively engage with communities and codevelop interventions, especially in Southeast Asian contexts. Despite rapid progress, the Lao People’s Democratic Republic (Lao PDR) still has high maternal and child mortality, with essential service coverage showing significant disparities across socioeconomic strata. Long-standing challenges in community health were exacerbated by the COVID-19 pandemic and reinforced by poor trust between users and health providers. However, the pandemic also provided an opportunity to develop approaches for enhanced community engagement and local governance capacity to tackle health inequities. The Community Network Engagement for Essential Healthcare and COVID-19 Responses through Trust (CONNECT) Initiative, developed by the Lao PDR government, WHO and partners, has resulted in initial positive outcomes in community health such as increased vaccination uptake, facility births and trust in health providers. This case study describes the iterative, adaptive process by which the CONNECT Initiative was developed, and how the core components, key stakeholders, theory of change and evaluation framework evolved from grounded observations and hypotheses. Lessons learnt include (1) awareness of entry points and existing structures to strengthen local governance for health through mutually beneficial intersectoral collaboration; (2) building relationships and trust with an adaptive, grounds-up approach for sustainability and scalability. As a model which can be adapted to other settings, this case study provides evidence on how to engage with communities, strengthen local governance and codevelop interventions towards greater health equity.