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This paper investigates how changes in neighborhood facilities-new schools, health posts, bus services, mills, dairies, agricultural cooperatives, and other facilities-influence perceptions of environmental degradation. We use three types of data from a rural area in Nepal: (1) data on changing neighborhood facilities from 171 neighborhoods, collected using ethnographic, survey, and archival methods; (2) survey data on household characteristics and environmental perceptions from 1,651 households; and (3) individual-level survey data. We find that new neighborhood facilities are associated with perceptions of environmental degradation. This is important because perceptions may indicate objective environmental degradation, encourage participation in programs to improve the environmental, and influence environmental behavior.