Agricultural intensification in Latin America has led to accelerated soil erosion, water pollution and food with pesticide residues, which are all signs of unsustainable development. In Uruguay, agricultural intensification with continuous cropping has threatened the country’s primary natural resource: its soil. At the same time, incentives for further intensification and specialization are high, since particularly soybeans have offered the highest (short-term) economic margins. This paper aims to contribute to the discussion about governance for sustainable development through an in-depth critical examination of the main flagship public policy response in Uruguay to soil degradation: the Soils Use and Management Plans (SUMP). SUMP indeed has managed to change cultivation practices in a more sustainable direction. The analysis shows that the relative success of SUMP is partly due to its experimental policy design which has allowed for collective knowledge construction and reflexive learning. It also shows that Uruguay’s long history of accumulated domestic soil expertise and state intervention rendered trust in the regulative process among producers and ultimately a high degree of acceptance. Nevertheless, while this policy is found innovative and promising, there is still a need for improvement of governance designs, if genuinely sustainable development is to be achieved.