This study intended to investigate the income generating projects (IGPs) and their impact on the management of public secondary schools in Tanzania, a case study of Kahama Town Council. The objectives of the study were; to identify the activities relating to income generating projects, to find out the impact of income generating projects in public secondary school, to assess the challenges facing income generating projects in public secondary schools and to identify the solutions to the challenges facing income generating projects in public secondary schools. The target population of this study was all heads of public secondary schools, teachers and students in Kahama Town Council. The sample size consisted of 50 teachers, 5 heads of schools and 25 students; total of 80 respondents. Data collection instruments were questionnaires, observation and structured interview. Convergent Parallel design was used in the study in which the researcher combined both qualitative and quantitative data in order to provide a comprehensive analysis of the research problem. The findings identified that, income generating projects existed in public secondary schools were crop farming, poultry, canteen, school shops and vegetable gardens. The schools use IGPs as one of the source of income which are essential for recurrent expenditures such as paying part time teachers, buying teaching and learning materials, meals for teachers and students and rewards for best students and teachers. This leads to the improvement of school academic achievement. Finally the study recommended that, government should support public secondary schools on IGPs funds and the provision of IGPs experts for the improvement and effective income generating projects.