‘Sustainability’ may be a generalizable concept; its definition however, heavily depends upon context. Understanding the context (sociocultural, environmental, socioeconomic, political etc.) is crucial for defining and assessing the sustainability of any given socio-ecological system. This point underlies our research design and objectives. The primary objectives of this research were to understand the sustainability context in the Upper Peninsula of Michigan, and to use it to develop a sustainability assessment framework for a potential forest-based bioenergy industry in the region. We first reviewed top-down and bottom-up sustainability assessment frameworks. Then we used the best-suited approach i.e. bottom-up participatory approach, to pursue our objectives. First, we critiqued a top-down sustainable development framework: the Millennium Project framework. We evaluated the generic environmental indicators employed by the Millennium Project to assess progress of developing countries toward environmental sustainability, based on the indicators’ relevance, comprehensiveness, practicality and sensitivity in a developing country’s context. We used Nepal as a case study for this analysis. Our results suggested that, while international (top-down) development and assessment frameworks play an important role in inserting broad sustainability concerns (e.g., biodiversity, water and sanitation, and environmental management) into country-level development agendas, indicators to monitor progress towards such goals are more effective if based on the on-the-ground realities (i.e., are relevant and practical).