Social capital has been the focus of considerable academic and policy interest in recent years. Despite this interest, the concept remains undertheorized: there is an urgent need for a critical engagement with this literature that goes beyond summary. This paper lays a foundation for a critical dialogue between social capital and health promotion, by examining problematics in the conceptualization and practice of social capital building and linking these to models of community development, a cornerstone health promotion strategy. In so doing, the paper contributes to the existing literature by providing a theoretical exposition and critique of various threads in social capital discourse, and linking these threads explicitly to community development practice. Distinctions between communitarian, institutional and critical approaches to social capital are elaborated, and the relationships between these three approaches and three models of community development-social planning, locality development, and social action-are discussed. The existing social capital literature is then critically examined in relation to three key themes common to both literatures: community integration, public participation, and power relations. This examination suggests that social capital cannot be conceived in isolation from economic and political structures, since social connections are contingent on, and structured by, access to material resources. This runs counter to many current policy discourses, which focus on the importance of connection and cohesion without addressing fundamental inequities in access to resources. This paper posits that approaches to community development and social capital should emphasise the importance of a conscious concern with social justice. A construction of social capital which explicitly endorses the importance of transformative social engagement, while at the same time recognising the potential negative consequences of social capital development, could help community organizers build communities in ways that truly promote health.