This paper describes a methodology for conducting Community Nutrition research with rather than on people in a community to generate grounded theory. This collaborative grounded theory methodology incorporates local knowledge and wisdom and builds community leadership capacity through engaging community-based professionals and para-professionals in the research process. In addition to building capacity for participation and leadership in research, education and action, this approach can increase the validity and value of the research and facilitate its application in community led programs. The methodology has five components: background, study design, data gathering, data analysis and interpretation, and application of findings in community programming. Three stages of the data analysis component focus sequentially on each interview independently, comparing across interviews, and systematically testing theory developed in the first two.