A Dissertation submitted to Mzumbe University Business School in Partial Fulfilment of the Requirement for the Award Degree of Masters of Business Administration (corporate Management) of Mzumbe University. 2013This study assessed the effect of rice price volatility through a case study of rice traders in Dares Salaam - Morogoro. The study was conducted inDar es Salaam at Kariakoo Market as well as Mzimbweni Market Morogoro. The main objective of the study was to assess the effects of rice price volatility among rice traders between Morogoro and Dar esSalaam municipalities. The data collection methods andtools were comprised ofinterviews, questionnaires, and documentary reviews. Statistical Package for Social Sciences (SPSS) was employed in data analysis. A descriptive cross-sectional study was used. A sample of 110 rice traders’ men and women, (respondents) business men and women (respondents) was used to select respondents from their trade centers. The study was provided by the Market department, the names of the traders who were dealing with rice to cover all rice traders and then use random numbers to formulate the random sample. It was revealed that among the reasons for price volatility in Tanzania are the increases in the exportation of rice,the increase in oil prices, poor infrastructures as well as a delay of agriculture inputs. There are negative effects ofhigher price volatility to poor consumers. They reduced the frequency of using rice as they are unable to afford,resulting in a change in their eating habits from average of three times a week to two times; while rich consumer are less affected. It was concluded that generally the effect of price volatility has a negative effects to the consumers. It is recommended that timely provisions and delivery of agricultural inputs to farmers, capital boots, modern agriculture, reduction of importation of rice and the improvement of infrastructure would help to alleviate the problem.