In the transitional period, the traditional top-down and government-led social management style cannot fit well with the needs of community development, and then it’s imperative to carry out the grassroots social management innovation. This paper firstly adopts the social capital perspective to construct a theoretical framework about the dynamical relationship between grassroots social management innovation and community development. It then analyzes the data collected from questionnaire surveys, onsite interviews and observations from the Xiaojiahe Community in Chengdu’s High-tech Zone to examine the reasons for the successful social management innovation in the perspective of social trust. It’s found that the availability of social capital determines the choices of methods for social management innovation in grassroots organization, and this innovative process in turn strengthens the accumulation of social capital which would promote community development. The holistic and coordinated community development would thus further improve the quality of social capital. It’s expected that this study will provide references for social management innovation in the future.