In this article, we use Kooiman's theory of governance in combination with key‐conditions of community self‐steering identified in recent studies to examine how the self‐steering capacity developed of a community initiative aiming at improving the liveability of a small Dutch village. Using non‐participatory observations and qualitative analysis, we obtained in‐depth insights into how this initiative, ‘Project Ulrum 2034' managed to build local autonomy from 2010 to 2018. We found that government support was crucial for many of its successes. Also, tensions came to light between 1. local autonomy, and its dependence on professional support, and; 2. broader community engagement, and accountability related to the public funding obtained leading to the formalisation of its organisation and the centralisation of tasks. We discovered that self‐steering capacities fluctuate in time, are dynamic and develop in a non‐linear way. The voluntary engagement was above all temporary, except for some activities when of direct interest to those involved. The continuity of community self‐governance was fragile, due to its dependency on external funding and voluntary engagement.