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This article is based on a study that investigated community awareness on the problem of water pollution and established its relationship to socio-economic development in urban Tanzania, with a focus on a case study of Ilala Municipality in Dar es Salaam region. A sample of 160 respondents (men and women) from Tabata and Kiwalani wards in Ilala district were randomly selected and interviewed. Data was collected through questionnaire, focus group discussions, participant observation, and documentary reviews. Findings revealed that water pollution has been a major problem confronting most of Dar es Salaam residents. Ignorance on effects of microbial water pollution has resulted in tremendous ill health, which, in turn, has had negative consequences on socio-economic development. Indeed, frequent endemic water-borne diseases in the studied area were found to be a result of lack of awareness on water pollution. The majority of respondents 156 (97.5%) rely on dug wells that are very close to pit latrines, and drink water without boiling. In addition, 54 respondents (33.8%) had little knowledge on what causes water pollution. Although some respondents were aware of the possibility of acquiring diseases from untreated water, they continue using water from wells and boreholes due to the lack of safe tap water and poverty (ability to boil water). In addition, many of the respondents did not know the status of their water, although there are many scientific reports indicating that most of the well water in this area is faecal-polluted. As such, knowledge on water pollution is lacking. The study recommends government intervention by supplying safe-water and educating people in order to avoid occurrence of gastro-intestinal diseases. In addition, there is a need to give feedback of scientific results obtained from scientific research to the society.