In 1972, George Powell, a scientist who was undertaking his predoctoral research on area birds, was amazed at the extraordinary biological riches of the cloud forest, which included the total habitat of the golden frog, a species endemic to Monteverde. Dismayed at the depreciation brought down by hunters and land speculators, Powell became interested in preserving part of this habitat. He obtained a donation of 328 hectares (820 acres) of land owned by Guacimal Land Co. that had been set aside for mining purposes. All that was needed was an organization capable of administering the property, since the land had been invaded by squatters.

George and his wife joined forces with Wilford Guindon, a resident and member of the local Quaker community. Together, they approached the Tropical Science Center in search of advice. By that time, TSC had become a Costa Rican non-profit organization, and had a program in place for the creation of private reserves for biological research and education. It also met the requirements for accepting donations of land. Powell joined TSC and the Center took on the responsibility institutionally for the administration of this upcoming protected area.

In 1973 the Center started an international fund-raising campaign in order to expand and protect the Reserve. Donations were received from the Explorer's Club of New York, the Philadelphia Conservation Society, the New York Zoological Society, RARE Animal Relief Effort, the World Wildlife Fund, Nature Conservancy, and the International Council For Bird Preservation. A number of individuals also contributed funds, including the bird photographer and philanthropist John Dunning. These gifts allowed the Tropical Science Center to acquire more than 1,100 hectares (2,700 acres) of forests between 1973 and 1978. By 1974, 471 travelers had visited the reserve, mainly scientists and birdwatchers.

In 1975 a forested area of 554 hectares (1,350 acres) owned by the Quaker community was added to the Reserve under a 90-year administration and preservation contract. This area, called Bosque Eterno (Eternal Forest) had been established as a hydrological reserve in the mid 1950's. Located on the slopes of Cerro Los Amigos, it was purchased from the Guacimal Land Co. by one of the first Quaker farmers, Hubert Mendenhall. The Tropical Science Center assumed administration of the property, bringing the total land area of the reserve to over 2,000 hectares, in mostly virgin rain forest.

Between 1975 and 1985 a battle ensued over the construction of a road that would cut through the reserve to get to the Peñas Blancas valley. The colonists cleared a trail, passing through the location known as La Ventana (The Window), for the removal of logs and cattle and to increase the value of the land. They made clearings, built rustic dwellings and hunted local fauna. However the policing patrols organized by Wilford Guindon stopped most of this activity. Today, Wilford continues as a member of the Reserve security and patrol personnel.

In addition to the squatters, the Ministry of Education also wanted Reserve lands (the Bosque Eterno portion) to set up a national television tower. In 1978 the Ministry began clearing land on Cerro Los Amigos, without negotiating approval from the owners. Again, thanks to the efforts of Wilford Guindon and others, the Tropical Science Center was able to establish a subleasing agreement with the Ministry, one that included strict conservationist clauses.

In 1977 the British Broadcasting Company (BBC of London) sent a group of natural history film producers to Monteverde and created a superb documentary. Because of the film's worldwide distribution, interest in the preservation of tropical rain forests increased. The number of visitors to Monteverde rose in 1978 to almost 2,000. At that time, various U.S. university students began research projects that involved collection and documentation of plant and animal species of the Reserve. Hummingbird studies were done, and one golden frog (toad) project was completed.

In 1979 TSC received various donations from individuals, including some from among its own members. After numerous financial difficulties, and with the help of The Nature Conservancy, the building called "La Casona" (the big house) was completed. Efforts to acquire more land in the Peñas Blancas and adjoining regions were continued. During this period, TSC made recommendations to the Costa Rican government that land in the forested areas of the Tilaran mountain range be purchased, in order to set up a large national park. However this request received no response. Facing the threat of greater deforestation on the mountain range, members of the Monteverde community banded together in 1986 to form the Monteverde Conservationist Association.

Acting in the name of the reserve, the "League," as it is known, sought financing for the acquisition of all of the properties in Peñas Blancas. Tropical Science Center would retain title to the properties purchased, and these would become part of the Reserve. The Center volunteered the services of Wilford Guindon and the then-current administrator Geovanny Bello to assist in the purchase of properties in the intermediate and lower basin of the Peñas Blancas River valley. Sufficient funds were collected for land purchases, and the Center continued to manage them. During this period, TSC vigorously opposed efforts by national entities to initiate mining exploration projects proposed by various companies.

In 1987, TSC established the Reserve Heritage Fund. The goal is to raise the fund to one million dollars, so that in the event that the number of visitors decreases, the accumulated interest can be used to pay for critical administrative and security services. The Reserve achieved its current extension of nearly 5,000 hectares in 1989.

The establishment of the Reserve was fully backed by the Quaker community, despite the fact that they were primarily farmers whose interest was agriculture. But because they clearly perceived the need to protect and preserve the forest resources surrounding their farms and fields, the Quakers became steadfast leaders in the effort to establish the Reserve. During the first years they helped to obtain financing, and during the construction of "La Casona." they received scientists and visitors as guests in their homes.

In 1975 the Reserve leased a property known as "Bosque Eterno" (Eternal Forest) from the Quaker community. This area had been set aside in the mid-1950's as a hydrological reserve, having been purchased from a mining company by Hubert Mendenhall. Hence, from its beginning, Monteverde Cloud Forest Biological Reserve has enjoyed a cordial relationship with the local Quaker community.