This study is aimed at describing the existence of illegal gold mining within the area of limited production forest of Bone Bolango regency which caused some environmental damage and pollution in the body of water in the area of Bone watershed as well as causing conflict on the environment biophysics, and mapping the role of actors or institution within that conflict. The conflict between the local community and the Gorontalo Minerals Ltd on the utilization of limited production forest space. The need for environmental management and appropriate conflict management which acceptable for all, government, local community, and company. Management which identifies the cause and solution to minimize or reduce conflict. This study is a descriptive qualitative study with study case approach through field observation, parameter quality test, literature review, interview, and group discussion. This study reveals that there is environmental damage such as mercury leakage into the body of the Bone river with the level of mercury >0.001 and with pH 7.25. Hence, it polluted the Bone river. The highest sediment is found within Tulabolo watershed by 196,430.26 tons/year, and the lowest sediment is found on Nagata watershed by 42,113.6 tons/year. The conflict between miners and company due to various actors involved in the management of the limited production forest such as the village government, investor, miners, member of parliaments, local government officers, and law enforcement officers. This conflict has led to social and economic jealousy within the community, which only benefits several actors. Thus, physical conflict in spatial occupation is inevitable.

Keywords : Environment, Conflict, Forest, Community.