This study aimed at analyzing the value chain for traditionally produced honey and identifying the most profitable value-adding activity practiced by traditional beekeepers. Specifically, the study intended (i) to analyze the value chain for traditionally produced honey in Kongwa district, (ii) to determine the contribution of honey to traditional beekeeper’s household income, (iii) to analyse costs and returns from honey value-adding activities in order to identify the most profitable value- adding activity, and (iv) to identify constraints limiting value addition to honey produced traditionally and recommend strategies to improve the position of traditional beekeepers in the value chain. Data were collected using a semi-structured questionnaire administered to 120 beekeepers randomly selected from four villages in Kongwa district. The results indicate that there is a great potential of honey production in Dodoma region if constraints such as access to reliable markets, lack of knowledge on value addition and poor harvesting equipments are removed. Furthermore, beekeeping was found to contribute about 44% to the income of the sampled households. Three major value adding activities undertaken by the traditional beekeepers are filtering, packaging and quality-testing. Profitability analysis indicates a significant difference in revenue accrued from unprocessed honey and value-added honey through filtering, packaging and quality-testing. Filtering without quality testing and packaging was found to be the most profitable value-adding activity as it yielded higher net revenue than when accompanied by packaging and quality testing. However, unprocessed honey is mainly demanded locally for making local beer. Individual beekeepers cannot access urban, regionaliii and international markets without adding value to their honey. It is recommended that interventions to promote beekeeping should focus on encouraging formation of marketing associations, modern beekeeping equipments use, imparting knowledge and skills on appropriate beekeeping, post harvest technologies and local production of cheap honey-packaging materials to encourage value addition.