Ghana produces about 2,000,000 metric tons of oil palm fruits annually, and small-scale processors contribute about 60% of crude palm oil production. The country is not self-sufficient in the fats and oils needed for industrial use and home consumption. A large percentage of the palm oil produced by small-scale processors cannot be utilized by the larger scale industries in Ghana or abroad because of its poor quality. There is an urgent need to explore the causes and to identify ways to address the situation. We carried out a diagnostic study in the Kwaebibirem District using key informant interviews, focus group discussions and surveys based on a semi-structured questionnaire to assess the processing practices of small-scale oil palm fruit processors, and to analyse the rationale behind these practices and their effects on the quality of palm oil produced. The processing practices identified included storage of loosened fruits for long periods before boiling, disposal of effluent into drains, use of spent tyres for boiling fruits and no clarification of the oil. About 54% of the processors store oil palm fruits for 1–3 weeks before processing, possibly allowing some fermentation, to increase extractability and reduce labour costs. This practice may reduce the quality of palm oil by increasing the levels of free fatty acids. The effects of the storage period on the quality and quantity of palm oil, the seasonal oil content of oil palm fruits, and the types of linkages and interactions amongst actors in the oil palm industry were identified together with stakeholders as issues for further research. Innovation in small-scale oil palm fruit processing is revealed as a multi-stakeholder, multiple-scale, and interdisciplinary process.