Lean construction (LC) is a production system with the potential to deliver exceptional performance within any organisation. LC is possible solution to the many problems faced by construction Small and Medium Enterprises (SMEs). However, Construction SMEs lack the needed resources which constraint their lean implementation efforts. A conceptual framework for capability and capacity building of Construction SMEs is developed based on the Toyota Way model. This research was conducted using systematic review of literature. The review suggests there is the need to build the capability and capacity of SMEs to fully adopt the LC philosophy. SMEs provide a challenging context for the implementation of LC due to their lack of the needed resources. The outcome of this study is to focus attention on building the capability and capacity of Construction SMEs to fully adopt LC. This will help reduce the incidence of high failure rates of LC implementation recorded amongst SMEs. Previous works have concentrated on what SMEs can and should do within their limited capacity. However, the use of the isolated tools and practices fail because lean is a system that has to be implemented holistically. A conceptual framework for building the capability and capacity of SMEs for LC adoption is therefore proposed.