Master of Public Health - MPH / Background: Hospital pharmacy practice is an important aspect of healthcare, as drugs are a key component of patient treatment in hospitals. In Lagos state, Nigeria, provision of healthcare services, including drugs, was at one time entirely free but in the face of ever dwindling resources and increasing government responsibility, the health sector has to compete with other sectors for scarce public funds. Therefore, in 2002, a private sector initiative (PSI) in hospital pharmacy was implemented in seven hospitals in Lagos state as an alternative financing system for managing drug procurement and supply to fee-paying patients. Each of these seven hospitals now has two pharmacies, one providing free drugs to certain categories of patients entitled to this service and the second providing services to all other patients. Aim: This study aimed to explore and describe the impact of this private sector initiative on the job satisfaction of the pharmacists working in these hospitals from the viewpoint of the hospital pharmacists and relevant stakeholders, and to suggest ways of improving the job satisfaction of hospital pharmacists in Lagos state. Study Design: The study utilized a qualitative research design to explore the perceptions and experiences of government-employed pharmacists and key stakeholders on the impact of the private sector initiative. Study Population and Sampling: Individual interviews were conducted with three key informants and two focus group discussions were carried out, one with hospital pharmacists from the fee-paying pharmacies and the second with pharmacists from the free pharmacies from the seven hospitals in Lagos state where the private sector initiative was in operation. Data Collection and Analysis: The audio-taped interviews and focus group discussions were transcribed and analysed to identify the key categories and themes raised by the participants. Results: The study found that most pharmacists felt that the PSI has met the main objective for which it was set up, that is, improving availability of drugs in the hospital but there were some attendant factors like inadequate funding of the free health unit, increased workload of the fee-paying unit and poor working conditions, which affect the job satisfaction of pharmacists. The study however showed that the introduction of the PSI has led to improved performance of roles and recognition of the pharmacists and better working relationships between pharmacists and other healthcare workers which have impacted positively on the job satisfaction of pharmacists. Recommendations: The study recommended that the working conditions should be improved and issues of staffing and workloads should be addressed. Also, alternative but effective means of drug financing should be sought to ensure availability of drugs to all categories of patients.