The study investigated the contribution of vocational education to youths’ employment in Mbeya Municipality. The study objectives were (a) to determine the sources of trade skills among youth employed in vocational activities (b) to examine the measures taken by the Vocational Training Centres (VTCs) in preparing their graduates for self employment. (c) To assess entrepreneurship knowledge among self-employed VTCs graduates (d) to identify the problems facing VTCs graduates in securing employment. The study was a cross sectional and data were collected from 192 respondents of which 172 were employees, 20 instructors and employers were eligible for interviews. The techniques and tools for data collection were questionnaires, interviews, and documentary analysis. Both quantitative and qualitative data were collected. Quantitative data was analysed using the Statistical Package for Social Sciences (SPSS) version 11.5. Multiple linear regression models were also used to prove the correctness of specific objectives. The result indicated that for those VTCs graduates who were employed in vocational work, trade skills were their main source of income. It was also indicated that although there is a larger number of VTCs, many were trained informally. Further, more result showed both VTCs graduates and instructors recommended that vocational education should focus on youth because it is easy to create self-employment. Vocational education contributed to youth employment but VTCs graduates were affected by several factors such as shortage of employment opportunity, capital and lack of entrepreneurship knowledge. Results also revealed that many VTCs graduates were unemployed despite possessing trade skills, leading some to involve themselves in non skilled activities such as security guards. The study recommends the government to introduce short courses, and initiate special support for self-employed VTCs graduates because some have managed self-employ themselves and are also employing other graduates and train those who missed a chance to join formal VTCs.