This study sought to investigate lecturer‟s perceptions about existence, extent and ramification of diploma disease at St. Augustine University of Tanzania. It was guided by three objectives, namely: a) to assess the lecturer perceptions about the impact of diploma disease on students‟ knowledge acquisition behavior; b) to examine perceptions of St. Augustine University of Tanzania students, lecturers, and alumni about the quality of education offered at St. Augustine University of Tanzania; c) to find out education quality assurance mechanisms that St. Augustine University of Tanzania has been employing over the years to ensure provision of quality education. The study was a case study that used a qualitative approach to collect data. A sample size of 25 informants, who were selected purposively, was used. Two research tools were used to collect data: semi-structured interviews, and focus group discussion. The findings showed there was high rate of student enrolment for Bachelor, Advanced Diploma and Certificate programmes. Most students were learning in order to get jobs and not how to do jobs. Lecturers were reducing giving individual assignments and tests for fear of failing to complete the marking within the deadlines. Due to the high rate of student enrolment, St. Augustine University of Tanzania‟s quality of education has been falling gradually. Some students usually did not participate in doing assignments and yet they got marks because fellow group members included their names in the lists of those who participated. Many students who joined St. Augustine University of Tanzania had poor English proficiency and poor academic background. St. Augustine University of Tanzania used to use TCU and national professional boards such as NBAA to ensure its quality of education. It also usually strived to employ qualified and competent lecturers.