Despite being renowned for its rich biodiversity and cultural heritage, Sri Lanka faces significant threats from development projects, agricultural expansion, and the overexploitation of natural resources, leading to unsustainable ecosystem management (EM). However, as in many parts of the world, local communities possess both documented and undocumented indigenous knowledge, acquired through real-life experiences, that is deeply connected to their environment. This information can be utilized to manage various land uses in the island in a sustainable manner. This chapter explores the significance of indigenous knowledge systems and the importance of community involvement in ensuring the preservation and stewardship of natural and man-made ecosystems in the country, examining key components and governance structures of sustainable EM systems, issues, innovative strategies, and governance frameworks. Furthermore, we emphasize the importance of inclusion, collaboration, and empowerment of local communities to achieve sustainable development goals (SDGs). The study is built around the model, Grassroots EM, which involves decentralization, cooperation, public engagement, and a holistic worldview to concurrently advance the environment, society, and economy known as the three pillars of sustainability. A conceptual framework based on the Strengths, Opportunities, Aspirations, and Results approach (SOAR) is proposed as a way forward for the effective management of ecosystems in the country, integrating indigenous knowledge systems.