In the last three decades, most of the peatlands have been converted into industrial plantations (especially oil palm) and have had positive impacts, however, peatland degradation continues, productivity is decreasing, local wisdom is being lost, and rural poverty is still unresolved. Local wisdom is part of a society’s culture, which is closely related to the uniqueness of indigenous people’s territories and functions to preserve the environment, balance the ecosystem, and reduce degradation. This research aims to emphasize the importance of local wisdom in peatland restoration. This research was designed using a mixed approach by combining quantitative and qualitative methods. Primary data was collected through field observations and in-depth interviews with key informants from the Peat Restoration Agency, local government, private companies, non-governmental organizations (NGOs), and other local stakeholders. The research resulted in the need to emphasize local wisdom in peatland restoration. Recommendations for local wisdom and its cultivation approaches, namely: Multi-Purpose Tree Species (MPTS) applied with a decentralized approach (participation of farmers and authority delegation); Gelam forest and honey bees through a conservative approach (being more profitable in the long term); Sago cultivation is recommended using the protective approach (natural benefits are greater than their commercial benefits); and an auction system for fishing is implemented with an optimal approach (harmony with the time, quantity, and quality of the environment).