The present article critically explores the frequently assumed relationship between land titles and rural credit, land prices and the functioning of the land market. It uses a combination of qualitative and quantitative data collected in the western part of Nicaragua to illustrate the multiple limitations for especially small-scale farmers to obtain the widely expected benefits of land titling. The article further argues that the lack of formal land titles is not the factor that primarily constrains small-scale farmers’ access to formal credit, and it questions whether land titles alone are responsible for creating higher land prices. Rather, the article proposes that the higher levels of economic wealth that are often associated with formal land titles, cause differences in land prices. Finally, it argues that the likely outcome of land market transactions is a re-concentration of land rather than distribution to the most efficient producers in a setting in which public institutions are weak.