A major legal reform of Chilean environmental institutions was approved in November 2009, at the end of Michelle Bachelet's administration. In sharp contrast with the external pressures that provided the impetus for the establishment of the country's environmental institutions in the early 1990s, this time the driving forces came mainly from an "internal demand," a broad social and political consensus about the need to improve the environmental framework. This consensus was a consequence of the institutional breakdown revealed by a local movement that emerged in Valdivia, southern Chile, in response to a major ecological disaster produced by the effluents of a pulp mill that polluted a protected wetland and caused the death and migration of an endangered population of black-necked swans. Although the Valdivian movement did not succeed in stopping the disaster and restoring the wetland, it triggered an unprecedented examination of the performance of environmental institutions, finally forcing the 2009 environmental reform. The resonance of the Valdivian movement can be understood in the context of dozens of environmental conflicts that had been accumulating for more than a decade, largely as an effect of the crisis of legitimacy of environmental institutions. Although this recently approved legislation represented an overall advance, it failed to address the issues that led to the institutional breakdown, in particular the need for democratization of decision making and the broadening of public participation. Paradoxically, thus, the reform perpetuated the crisis of legitimacy that underlay its origin, reinforcing the exclusionary mechanisms that largely explain socio-environmental unrest and ecological destruction in Chile.