Capacity development (CD) partnerships between highly qualified expatriates and host-country counterparts are a commonly used tool by non-government organisations (NGOs) working in international development. This paper reports on an empirical investigation of the factors contributing to the effectiveness of these interpersonal cross-cultural CD relationships. Using a variant of the critical incident technique, it explores 40 such relationships (20 effective and 20 ineffective) reported by 20 expatriates from an Australian international NGO who were embedded in international and domestic NGOs and government organisations in Vietnam. It proposes a theoretical model that identifies the features of effective cross-cultural CD relationships. The model is intended to lay the foundation for future research as well as strategic action by organisations. It identifies shared trust between expatriate and counterpart as central to effective CD, supported by five enabling conditions relating to the perceptions, abilities and attitudes of participants, the way the work roles are structured, and the way that leaders in the host organisations manage the context of the relationship.