Pollution of water sources for the city of Dar-es-Salaam originates from haphazard disposal of solid wastes, discharge of untreated or inadequately treated wastewater to water sources, lack of standard sanitary facilities and poor hygienic practices. Contaminated water used for human consumption can lead to serious health problems e.g. cholera, typhoid, skin diseases, etc., which, in turn, leads to reduced working hours/manpower. This has a direct effect to production output which can lead to a deterioration of local community welfare. Having realised this as a problem, the Government of Tanzania stipulated, in its water policy of 1991, the need for protection of water sources. In achieving this goal, proper waste management was singled out to be of vital importance. Due to economic hardships, however, budget allocation by the central Government could not cover the costs needed for proper handling of waste. This left Tanzania with no alternative other than heavy reliance on donor and bilateral organisations for financial support of programmes. Nevertheless, these sources of funds proved to be unreliable for many different reasons. To deal with these problems, the Government currently emphasises involving local community and NGOs, the formation of stakeholder funds and organisations, and involvement of the private sector. Other efforts are intensification of education programmes to create more awareness to the local communities on the need for protection of water sources. Although at its infancy level, the system is showing some signs of improvement.