Improving local neighborhoods used to mean identifying and combating local problems. Today, a new approach is being used by a number of foundations, public officials and activists to build the capacity of local communities. Based on asset-building theory, these models target the institutional strengths of local areas to promote the economic and social viability of the community. Because nonprofit and community-based groups are often viewed as neighborhood assets, the John S. and James L. Knight Foundation asked the Center on Nonprofits and Philanthropy (CNP) at the Urban Institute to analyze the size, scope and spatial dimensions of the nonprofit sector in Lake County, Indiana, with special attention to the central city of Gary.