The Okavango basin comprises the Cuito and Cubango active catchment areas in Angola, in addition to the Kavango-Okavango non-active catchment in northern Namibia and Botswana. The Okavango River water and its ecosystem resources are critically important sources of livelihoods for people in the basin. Pressures from livelihoods and development are already impacting on the environment. These pressures may increase in the future due to the rapid increase in population, the peace process and associated resettlement activities in Angola, and major development initiatives in Botswana and Namibia. For instance, possible future increase in water abstraction from the Okavango River may affect the long-term environmental sustainability of the Okavango Delta by minimizing channel shifting and thereby reducing spatial biodiversity. The paper argues that while conservation of the natural environment is critical, the pressing development needs must be recognized. The reduction of poverty within the basin should be addressed in order to alleviate adverse effects on the environment. The paper recommends that the development of sustainable tourism and community-based natural resource management initiatives may be appropriate strategies for reaching the Millennium Development Goals of poverty alleviation and achievement of environmental sustainability in the Okavango Basin. These initiatives have a comparative advantage in this area as demonstrated by the performance of the existing projects.