Vietnam has one of the fastest growing economies in the world and has achieved significant socio-economic development in recent years. However this growth is placing increased pressure on an already depleted natural environment. Environmental impact assessment (EIA) is recognised by the Government and international organizations as an important tool in the management of the impacts of future development on the country's natural resource base. The Government's commitment to EIA has been demonstrated through the development and adoption of the Law on Environment Protection (Revised) in 2005 which sets out the requirements for EIA and which represents a major step in the development of a robust legislative framework for EIA in Vietnam. The Law on Environment Protection (Revised) 2005 has now been operational for several years and we have undertaken an evaluation of the resulting EIA system in Vietnam. We argue that while significant improvements have been achieved in the EIA policy framework, an important gap remains between EIA theory and practice. We contend that the basis of the current EIA legislation is strong and that future developments of the EIA system in Vietnam should focus on improving capacity of EIA practitioners rather than further substantial legislative change. Such improvements would allow the Vietnamese EIA system to emerge as an effective and efficient tool for environmental management in Vietnam and as a model EIA framework for other developing countries.