This paper comparatively reviews and analyzes the participatory component of two participatory rural development projects in the North-West Frontier province (NWFP), Pakistan. The participatory rural development models of the two projects are compared in terms of institutional building, rural capital formation, natural resources management and capacity building. Tie two models arc also comparatively analyzed in the context of three aspects of participation: the extent and quality of participation, the cost and benefit of participation, and the impact of participation on outcome, performance and sustainability. The study confirmed that a government-sponsored project is comparatively, more effective, efficient and sustainable than an NGO-sponsored project. The superiority of the government project is due to its approach flexibility, exit strategy, formulation of NGOs on the basis of economic, socio-cultural and ethnic norms, and values.