Forest ecosystem dynamics are driven by a complex array of simultaneous cause-and-effect relationships. Understanding this complex web requires specialized analytical techniques such as Structural Equation Modeling (SEM). The SEM framework and implementation steps are outlined in this study, and we then demonstrate the technique by application to overstory-understory relationships in mature Douglas-fir forests in the northwestern USA. A SEM model was formulated with (1) a path model representing the effects of successively higher layers of vegetation on late-seral herbs through processes such as light attenuation and (2) a measurement model accounting for measurement errors. The fitted SEM model suggested a direct negative effect of light attenuation on late-seral herbs cover but a direct positive effect of northern aspect. Moreover, many processes have indirect effects mediated through midstory vegetation. SEM is recommended as a forest management tool for designing silvicultural treatments and systems for attaining complex arrays of management objectives.