Grand societal challenges such as forced displacement are extreme and complex issues that are challenging to individuals and might seem insurmountable. How do local actors make sense of, position themselves in and act on such challenges? We conducted a case study of the collective sensemaking narratives of 71 actors involved in the refugee crisis on Lesbos, Greece. We elaborate how actors make sense of their role in the local response to this grand challenge and explain why some ultimately chose to cooperate to address the plight of refugees while others distributed tasks or avoided responding altogether. We identify three collective sensemaking narratives that actors use to validate such action strategies aimed at alleviation, personal recovery or structural change; and as characterized by different forms of interaction and emergent collective sensemaking. We contribute with our article to the study of responses to grand challenges by showing how a collective sensemaking framework can be used to understand local responses. We also contribute to extant theorizing on collective sensemaking by showing how actors make sense of grand challenges through interactions with other actors and how their narratives inform individual and collective action.