Tourism is the fastest growing industry and the largest in the world in terms of contribution to the Gross Domestic Product, and second after agriculture for providing employment. However, there is a paucity of information on how tourism improves the livelihood of the communities living in the Uluguru and Udzungwa Mountains of Tanzania. This study therefore sought to contribute some information to fill the existing knowledge gap. The study was conducted in four villages, namely Nugutu, Ruvuma, Mwaya and Mgudeni. Data were collected using household questionnaires, structured interviews, focus group discussion and field observation. Quantitative data were analysed using SPSS and Microsoft excel computer software while qualitative data were analysed using thematic analysis. Result shows that, only 32.5% of respondents articipated in tourism activities in the study villages. Limitations for their participation include: limited awareness on tourism, intensive engagement in agriculture, health problems, poor leadership and lack of interest. Local people participated in tourism activities through traditional dances, weaving, raditional cooking, handcrafts making, pottery, tour guiding and porter. Indicators of participation in tourism activities by local people include: presence of tourism projects in the village; income obtained from tourism and the inclusion of tourism as an agenda in the village meetings. Local communities benefited directly from tourism through income generation and employment opportunities and indirectly through market creation for local products and other benefits like provision of social services, conservation education, capacity building, women empowerment and cultural mprovements. Proportion of tourism income to the total household income was only 5% which was relatively low compared to agriculture (88%) and other sources (7%). The study recommends the need to provide the following to the local communities: education, training programs and awareness creation; supporting community development tourism projects; strengthening local leadership and sharing of the benefits accruing from tourism beyond National Parks.