Development projects in tropical forests can impact biodiversity. Assessment and monitoring programs based on the principles of adaptive management assist managers to identify and reduce such impacts. The small mammal community is one important component of a forest ecosystem that may be impacted by development projects. In 1996, a natural gas exploration project was initiated in a Peruvian rainforest. The Smithsonian Institution's Monitoring and Assessment of Biodiversity program cooperated with Shell Prospecting and Development Peru to establish an adaptive management program to protect the region's biodiversity. In this article, we discuss the role of assessing and monitoring small mammals in relation to the natural gas project. We outline the conceptual issues involved in establishing an assessment and monitoring program, including setting objectives, evaluating the results and making appropriate decisions. We also summarize the steps taken to implement the small mammal assessment, provide results from the assessment and discuss protocols to identify appropriate species for monitoring.