In Australia, we are facing a period of mental health reform with the establishment of federally funded community youth services in rural areas of the country. These new services have great potential to improve the mental health of rural adolescents. In the context of this new initiative, we have four main objectives with this article. First, we consider the notion of social capital in relation to mental health and reflect on the collective characteristics of rural communities. Second, we review lessons learned from two large community development projects targeting youth mental health. Third, we suggest ways in which the social capital of rural communities might be harnessed for the benefit of youth mental health by using asset-based community development strategies and fourth, we consider the role that rural clinicians might play in this process.