This study examines privatization and valuation processes in the context of privatized state owned enterprises in Tanzania. It investigates the implementation of the privatization process and valuation methodology in a developing economy where the market system and its associated institutions are not fully developed. The objective of this study is twofold, first to investigate how the privatization process was carried-out towards the stated objectives and second to find out how asset valuation was carried-out in assisting decision-making at the ‘Presidential Parastatal Sector Reform Commission’ (PSRC). As a means to achieve the above objective, the study traces five interrelated aspects in the privatization process. The tracing attempted to find out whether or not the five aspects proceeded in ways that enabled attainment of the stated objectives. The five interrelated aspects included, Formulation of privatization strategy; Valuation methods; Valuation error; Buyers of State owned enterprises and Developments after privatization. The study found that strategy formulation being undertaken by PSRC did not promote higher competition, higher prices and higher government revenue; the present Valuation methodology as used by the Valuation firms engaged by PSRC did not improve certainty in the determination of reserve price; further that valuation estimates were not good proxies of sale prices; the issue of wider ownership participation by the people was far from being achieved; And that follow-up on changes of ownership and changes in the physical developments was lacking. Both privatization and valuation stand to yield expected results where the market system and its institutions are well developed and are functioning properly. Had there been reasonable and basic preparations prior to take off, privatization process in Tanzania could have been carried out in better ways and yielded better results than it is now / QC 20100915