The notion of agency has received increasing attention in development planning and development processes and is considered an essential aspect of Human Development as conceived through the capability approach. In addition, there is a growing trend to consider agency not from the perspective of the individual agent, but emphasising its collective dimension. Within this framework, this article aims to explore how collective capabilities and agency are being expanded in rural indigenous Guatemala through small community-led development projects supported by United Nations Global Environment Fund. To this end, an analytical framework is defined from the capability approach perspective on the grounds of the idea of collective capability. The article draws on research in indigenous communities in Western Guatemala, currently being supported by the Small Grants Programme, funded by the Global Environment Fund and administred by United Nation Development Programme. These interventions have been implemented following El Almanario approach, an innovative approach aimed at empowering communities in the design, implementation, monitoring and evaluation of their own projects.