There has been growing interest in the role and potential which cooperatives can play in terms of economic and community development in the Global South as alternatives to more conventional models of business organisation. One country which has been particularly proactive in this regard is South Africa, where cooperatives feature prominently in national and provincial level development strategies and support. This paper overviews key themes in the literature before proceeding to a case study of the effectiveness of state support for cooperatives in the Free State Province of South Africa. Findings show that the well-intentioned objectives of state interventions are not being realised due to poor business planning, lack of training, poor market links and the seeming prioritisation of political over economic considerations.