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Traditional farming landscapes have been created in coexistence of rural dwellers and local ecosystems over long time spans, and can be considered tightly coupled ´social-ecological systems´ (SES). Since these landscapes typically embody exceptionally high levels of biological diversity and multiple socio-cultural values, their protection is critical from a sustainability perspective. Due to the pressures of globalization and social change, however, rural livelihoods and farmland biodiversity are at risk. While the focus of research is often on the Southern hemisphere, there are traditional farming landscapes in the former socialist countries of Central and Eastern Europe (CEE) which are equally affected by rapid change, and thus deserve particular attention. Since the institutional breakdown of socialism in 1989, the CEE states have not only been confronted with an unprecedented socio-economic and environmental transition. Their integration into the multi-level governance regime of the European Union (EU) further resulted in the transformation of decision-making structures and competition within the EU common market. In light of the profound changes traditional farming landscapes of Central and Eastern Europe are confronted with, they serve as a valuable source of learning about the institutional design necessary to harmonize socio-economic development and biodiversity conservation within regional social-ecological systems worldwide. This thesis is the result of an in-depth analysis of one traditional farming landscape of Central and Eastern Europe, namely Southern Transylvania (Romania). Based on empirical research involving diverse stakeholder groups, this thesis assessed the impact of EU policy on the area, the institutional features characterizing local-level governance in Southern Transylvania, and the barriers and bridges towards sustainable rural development. This thesis finds that while rural dwellers are highly dependent on smallholder farming and local ecosystems for their livelihoods, Southern Transylvania is currently confronted with a range of structural development barriers. These are likely to be exacerbated by a governance system consisting of historically grounded ´elite social networks´, and by EU policies which often do not fit rural realities. The findings of this dissertation underline that entrenched informal institutions, political will, and historical legacies play a critical role for the governance of traditional social-ecological systems since these ´social system features´ do not only mediate how external policies act on the local level. They may further restrict local adaptive and innovation capacities which, however, are critical for the transformation towards sustainable development. This thesis further finds that there are no blueprint solutions for the design of rural development strategies. Instead, (supra-) national policies should take better account of local socio-economic and cultural particularities.