The aim of this project was to develop a conflict management model for Local Authority Organization (LAO) on developing and implementing the educational policies in school. Participatory Action Research was employed in a process for conflict identification and solution to enhance a positive relationship of LAO and Basic Education School (BES). Twenty four participated samples included LAO chief executives and members, school administrators and teachers, and school board. The main identified conflict issues were a complicated administration authorization, inflexible budget management, misunderstanding of existing and contracted teachers, noncompliance of maximum welfare and bonus, and nonconformance needs of LAO and School. Face to face honest communication was recommended as an appropriate mean to improve the BES and LAO relationship, particularly both sides needed to listen, acknowledge, and evaluate. Consequently, the BES and LAO could create mutual trust and credibility for management of the rural community school's education concerns.
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