Sustainability, knowledge forms and rural development are the core concepts combined in this study to explore how different forms of knowledge manifest themselves in rural development and how their dynamics can contribute to rural sustainability. Based on a qualitative research process, we compare two individual livelihood strategies from rural Hungary, the case of a family farmer and a potter. We argue that scientific, local and managerial knowledge forms cannot be identified in pure forms in Hungarian rural initiatives. In the absence of a strong networking capacity, rural entrepreneurs replace knowledge-sharing and community-learning processes with individual knowledge-gathering strategies. As a consequence, person-bound, multifaceted knowledge sets are used in rural initiatives and are produced according to context; however, the absence of knowledge dynamics hinders actors in developing sustainable solutions. Thus, rural development policy should encourage interaction among different rural actors instead of aiming at providing better education for managerial knowledge.