Street vendors remain prominent in the modernising urban economies of many developing countries, and competition arises between public space and income generation. Managing this dilemma usually involves punitive methods which exacerbate poverty. This article examines differing approaches to street vendor management in Indonesia, which is now hailed as the world's third-largest democracy. As part of the political transition, local governments are required to implement pro-poor policies which could strengthen micro-enterprise. However, this process is usually impeded by lack of political will, administrative expertise, and the ability to innovate. In a comparative analysis of street vendor management in two of Indonesia's best-known municipalities, the authors point to participatory practices which help the integration of street traders into local economies.