Abstract: Towns in central western Queensland are especially exposed to the risks of drought, with approximately half of the businesses directly linked to agriculture. This paper reports on surveys undertaken in 2015 and 2017 of town business. A significant reduction in turnover is reported by businesses in the region’s largest town, Longreach. Populations have declined sharply over the past four years, partly due to itinerant agricultural workers leaving the region. Townspeople are major contributors to social cohesion and resilience in rural and regional communities. Declining grazier incomes have led to reduced spending in town businesses as well as a negative spiral of declining population and declining services, resulting in lower social resilience in rural and remote communities. Policy makers have four options: do nothing; understand the local context; support local capacities; and/or transform. Transformation of governance arrangements is crucial if social resilience is to be restored. Drought assistance can contribute to developing more resilient communities. Recommendations include fostering innovation and changing the roles and responsibilities in collaboration between government and local organisations.