Dissertation (MA Public Administration)Tanzania has recently been experiencing strikes of employees like teachers, doctors, railway workers etc from public institutions and their main claim was job dissatisfaction in terms of salaries and working conditions. This study was conducted in two large public institutions AUWSA (Arusha Urban Water Supply and Sewerage Authority) and TANESCO (Tanzania Electric Supply Company) in Arusha city council; the study involved a total of 131 participants. Case study designing was employed while qualitative research approach dominated the entire study. The study aimed at exploring factors which contribute to job satisfaction in public institutions. Findings from this study revealed that the major factor that contributes to job satisfaction is the relationship between employees with their core workers. Other factors that contribute to moderate satisfaction include job position, ability to balance work and personal matters, chance to utilize skills and ability, recognition, supervision, pay and job security. Generally 63.4% of all employees participated in the study from the two public institutions expressed their level of satisfaction with their jobs as "somehow satisfied" while 14.5% had a high level of satisfaction. In addition, 18.3% of the participating employees were neither satisfied nor dissatisfied and 3.8% were completely dissatisfied. The study has also revealed that job satisfaction contributes very much towards ensuring job performance and the two variables influence each other. Also a strong relationship between the rate of efforts being offered by employers for job satisfaction, the level of satisfaction being realized and the level of employees' performance do exist. It is then recommended that the government should formulate job satisfaction policy since job satisfaction influence job performance. Also further research should focus to find out why effort on job satisfaction has impact on level of satisfaction and level of performance.