On February 5 1996, the Cape York Peninsula Land Use Heads of Agreement was publicly unveiled in Cairns, North Queensland, Australia. The agreement represented a unique and historic alliance between Cape York's graziers, indigenous people and environmentalists, and demonstrated that it was possible to negotiate a solution between conflicting interests in the Cape at a time when Australians were experiencing high levels of fear and misinformation about Aboriginal access and rights to land. This work proposes that the Cape York Heads of Agreement was an example of transformative negotiation, that is, negotiation which strategically addresses power and structural issues and develops practical solutions to conflict through processes of critical reflection, critical dialogue and learning in and from action.