In Orissa 100 thousand ha of village plantations were established from 1985 to 1992 as an aid project to support the subsistence needs of rural poor and to relieve heavy pressure on the natural forests. The aim of this paper is to examine the welfare and environmental effects of these village plantations. To do this, extensive data collection was needed which included both household utilization of different sources of biomass as well as remote-sensing information, to establish the status of the vegetation and it's spatial location vis-a-vis the users. The study shows that plantations have the potential for substantial welfare improvements for the target population, especially women, through increased consumption of biomass, decreased time for collection and decreased pressure on natural forests. However, interventions need to be very selective in order to be successful, with special consideration given to plantation location compared to natural forest.