A Dissertation Submitted in Partial Fulfillment of the Requirements for Award of the Degree of Master of Public Administration of Mzumbe University- Dar es Salaam Campus.Sustainability of donor-funded projects has continued to be questionable in different parts of the country including Dodoma. It is reported that some of the projects implemented previously are currently not functioning. Considering that there are ongoing water projects implemented in the region, it was necessary to assess the factors affecting sustainability of donor-funded water projects. The general objective was to assess the factors affecting sustainability of donor funded water projects. The design used in the study is a descriptive research design. The study was carried out at Kibaigwa ward which is located at Kongwa district. Sampling techniques used in the study are the convenience sampling technique and purposive sampling technique. Data collection methods used in the study are questionnaire method, interview method and documentary review. The findings show that the sustainability of donor-funded water projects such as Saman Corporation’s Water Supply Project implemented at Kibaigwa ward fail to be sustainable due to the existing challenges. These challenges include lack of funds, lack of community participation, lack of proper monitoring and evaluation and lack of competence among project staff and contractors. Thus, there is the need to increase participation of the community, training to project staff and increase participation of the government in the implementation of projects.