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A global surge in ‘artisanal’, smallscale mining (ASM) threatens biodiverse tropical forests and exposes residents to dangerous levels of mercury. In response, governments and development agencies are investing millions (USD) on ASM formalization ; registering concessions and demarcating extraction zones to promote regulatory adherence and direct mining away from ecologically sensitive areas. The environmental outcomes of these initiatives are seldom systematically assessed. We examine patterns of mining-related deforestation associated with formalization efforts in a gold-rich region of the Peruvian Amazon. We track changes from 2001 to 2014 when agencies: (a) issued 1701 provisional titles and (b) tried to restrict mining to a >5000 km ^2 ‘corridor’. We use fixed-effect regression models and matching methods to control for gold price, geology, and accessibility. Mining increased dramatically during this period, clearing ∼40 000 ha of forest. After the mining corridor was declared and enforcement increased, new mining sites were opened more frequently within titled areas and inside the corridor than elsewhere. However, mining also increased in protected area buffer zones and native communities, and the proportion of mining area occurring outside the corridor grew, concentrated in a few hotspots. Interviews ( n = 47) revealed that the hoped-for regulatory adherence failed to materialize because miners who were issued provisional titles started operations without complying with attendant environmental rules. Overlapping land claims for agriculture and forest extraction proved a major obstacle for obtaining full legal rights to mine. Miners resented the slow, costly formalization process but many sought titles to bolster territorial claims, avoid policing, obtain credit and recruit paying ‘guest’ miners who generally ignored regulations. We find that responses to formalization varied with changing context and while formalization may curb mining in some circumstances, it may exacerbate it in others. Without adequate enforcement, interagency coordination, and attention to competing land claims, formalizing ASM may accelerate ecological destruction.