Through a case study of the grassland system of the Mkambati area in the Eastern Cape, South Africa, the paper explores the interaction of social institutions and ecological processes in the creation of a diverse grassland environment. A number of different transitions between grassland states are examined in detail, highlighting a range of social and institutional factors influencing grassland change. The spatial patterning of different grassland types and the frequency of transitions between them are shown to be dependent on the institutional relationships between different social actors. Understanding such complex and multifaceted processes of environmental change requires analytical tools which combine social and ecological perspectives; an extended form of qualitative "state-transition" modeling, which incorporates institutional dimensions, is therefore explored. Keywords: grasslands, stat and transition models, environmental change, social institutions, South Africa.