Good governance refers to government agencies' conduct in implementing innovative policies and programmes to increase the quality of public service with the ultimate aim of increasing economic growth. This paper investigates good governance in Indonesia, with a focus on its implementation by regional / local government. Indonesia's good governance implementation has attracted further attention with it being the vocal point of its current president's, Susilo Bambang Yudhoyono, presidential vision and mission. Although much research has acknowledged good governance implementation at regional/local government level, the extent of implementation has varied, suggesting partial or incomplete implementation of good governance principles. This paper investigates impeding factors that do not support effective implementation of governance protocols. Analysis of findings found nine impediment variables to good governance and a large disparity gap in good governance understanding and implementation. Further investigation of findings allows a conclusion whereby the main challenge for good governance implementation is the existence of a double edged sword; lack of good governance legal instruments as well as a lack of bureaucratic reform.