Within the past twenty years, Northern donors have begun direct funding of LGBT movement organizations in several African nations. Although some donors primarily fund HIV/AIDS projects that serve African LGBT people, other donors earmark funds for projects on enhancing LGBT rights or on reducing African gender and sexual minorities’ exposure to harm. Despite scrutiny of Northern funding practices, there is little understanding about new forms of normativity among LGBT movements in the global South that arise in relation to Northern funding. Drawing on original research conducted in Malawi and South Africa, we argue that African LGBT activists face a “queer dilemma” with respect to Northern funding. The benefits Northern funding affords make it difficult for African LGBT activists to refuse foreign money, although accepting funding renders LGBT groups vulnerable to both heteronormative and homonormative pressures that buttress neocolonial power relations. Some organizations experience antigay hostility cast as efforts to decolonize the country, while others experience expectations to replicate Northern LGBT organizational forms and practices. Situating our case studies in critiques of the “NGOization” of feminist and LGBT movements and in queer development studies research, we explore the consequences of Northern funding on LGBT activism in Malawi and South Africa.