Women’s groups, working through participatory learning and action, can improve maternal and newborn survival. We describe how they stimulated change in rural Nepal and the factors influencing their effectiveness. We collected data from 19 women’s group members, 2 group facilitators, 16 health volunteers, 2 community leaders, 21 local men, and 23 women not attending the women’s groups, through semi-structured interviews, group interviews, focus group discussions and unstructured observation of groups. Participants took photographs of their locality for discussion in focus groups using photoelicitation methods. Framework analysis procedures were used, and data fed back to respondents. When group members were compared with 11 184 women who had recently delivered, we found that they were of similar socioeconomic status, despite the context of poverty, and caste inequalities. Four mechanisms explain the women’s group impact on health outcomes: the groups learned about health, developed confidence, disseminated information in their communities, and built community capacity to take action. Women’s groups enable the development of a broader understanding of health problems, and build community capacity to bring health and development benefit.