Among the different functions forests offer, recreation is increasing in importance to a growing global population. This is at a time when multifunctional forest management can no longer cover its costs solely from the revenue from wood production. The governance of forest recreation is assumed to be different from that of other forest functions but is poorly understood, which limits proper forest management. Meanwhile, conflicting interactions between forest users are increasing. In this paper, we study forest recreation governance with a particular focus on forests in urban areas in developed countries. The paper first identifies key governance challenges for forest recreation and then provides a better understanding of forest recreation governance, focusing on the role of stakeholders and institutions. This is done using the Institutional Analysis and Development framework. We use urban forest areas of Switzerland to illustrate and exemplify the developments in forest recreation and their consequences for forest governance. The study draws on different empirical sources and analysis techniques, including statistical data, focus groups and document analyses. The findings show that six main action situations need to be considered when analysing forest recreation governance. In each action situation, several stakeholders are involved. We argue that understanding the governance of forest recreation is one of the future challenges in forest management and planning, particularly in urban areas. Finally, our study shows that the applied framework is appropriate and useful in analysing the structure and arrangements of forest recreation governance.