Community-based forestry (CBF) has developed through co-evolution of human societies, social values and biophysical systems shaped by long-term community activities. CBF has been practised for nearly 40 years in Nepal and has resulted in the restoration of forest cover to a considerable proportion of the mountain regions. In the Phewa watershed, restored forests are important for the subsistence of local communities and the provision of economically valuable recreation, aesthetic and cultural services for a wider group of stakeholders. In that context, this study aims to assess the social values of ecosystem services (ES) and their relative importance to different stakeholders. Community perceptions and expert opinions to assess and prioritise ES in the watershed were sought through focus group discussions and key informant surveys. There were 23 ecosystem services relevant to the local communities and other stakeholders in the watershed. Sediment retention, recreation and ecotourism, freshwater, firewood and timber were priority ES for local benefits, while recreation and ecotourism, biodiversity maintenance, sediment retention and carbon stock were priority ES for wider (regional – global) benefits. Priority ES revealed key areas of correlation and conflict between different services and between stakeholder groups. For local benefits, trade-offs were identified between provisioning services and regulating, habitat and cultural services. Synergies were predominant between regulating, cultural and habitat services. The study indicated that the social values concept is a promising tool for eliciting people's preferences in the ES assessment and analysis of trade-offs and synergies in developing countries where community involvement is the dominant approach of forest management.