This study contributes to the developing countries' public policy discourse by linking outcomes of the past and present urban housing policies in Tanzania to both the organisational structures and work methods of the state and to environmental factors. By tracing the historical development of urban housing policy formulation and implementation in Tanzania, the study provides a comprehensive and systematic analysis of the factors responsible for the poor performance of urban housing policies in Tanzania. The study is also important because it locates the policy development within the general literature of urbanisation and housing in the developing countries and within theoretical debates relating to policy explanation in these countries. The study documents a detailed case study of a specific project (the National Sites and Services and Squatter Upgrading Project - NSSP) aimed at addressing urban housing problems in Tanzania and uses this to identify a range of politico-administrative issues which affect policy formulation and implementation in Tanzania. In pursuing this task the study adds to the understanding of the factors affecting policy performance in developing countries experiencing constraints and contextual variables similar to those of Tanzania.