Many studies have been done on HIV/AIDS in Tanzania yet few empirical studies have been conducted to examine the effect of HIV/AIDS in urban areas including Dar-es- Salaam. This study therefore aimed at estimating the extent to which HIV/AIDS affects household livelihoods as well as identifying common coping mechanism of affected and unaffected households with regard to food security, asset ownership/possession and social network. Therefore, this study was conducted with the specific objectives to: determine the social impact associated with HIV/AIDS; determine wealth of the affected and non- affected households; identifying coping strategies used by household with regard to impacts of HI/AIDS; and compare the impacts of HIV/AIDS between affected and non- affected households. The study gives the detailed explanation on livelihoods framework and establishes household’s socio-economic impacts. A cross sectional design was employed. An interview by using closed and open-ended questions was used to get required information. A sample size of 90 respondents was involved of which 45 were affected and 45 non-affected households by HIV/AIDS. Snow-ball (chain referral) sampling technique was employed for the selection of individual respondents affected by HIV/AIDS. Multistage and purposive sampling techniques were used to select 45 non- affected households. Data from these respondents were analysed by using Statistical Package for Social Science (SPSS) Version 11.5-computer program. The study revealed that petty business was the main economic activity of the affected respondents (90%). Existence of stigma, poor people integration, inheritance of the widow and inability to provide amount of remittance are the social impacts of HIV/AIDS on household livelihood. The other economic bottleneck is food insecurity, failure to pay medical expense, poor income and school dropout (s). In order to cope with miserable conditions the study identified a number of coping strategies including reduction in number of meals, selling of household assets and children to live with relatives. Therefore affected households experience more shock of social and economic welfare than non-affected households. The study recommends among other things, new ways of preventing and combating HIV/AIDS from a small scale to a large scale by bringing together the weight of the government and non governmental organizations in order to generate shared momentum so that the magnitude of the problem can be reduced and therefore household livelihoods can be well attained.