Mussa, Kassim R.Mwakaje, Agnes G.2016-03-162016-03-162013Mussa, K.R. and Mwakaje, A.G. (2013), “The impact of equitable payment for watershed services scheme on livelihoods in Tanzania: The case of Uluguru Mountains”, International Journal of Development and Sustainability, Vol. 2 No. 2, pp. 1031-1051.2168-8662http://hdl.handle.net/123456789/1009Care International and WWF initiated Equitable Payments for Watershed Services (EPWS) scheme. The Scheme aimed at modifying unsustainable land use practices to conserve watershed areas in the Uluguru Mountains and improving the livelihoods of the communities. This study investigates the outcome of the project and this study is a response to this. A total of 120 households were selected randomly from 3 villages under the Scheme. There was also a consultation with focus groups and key informants. Structured and semi-structured questionnaires were used to collect information and analysed using Chi-square and Choice Model techniques. Findings revealed a significant improvement in social capital and land productivity (p=0.05) while access to non-timber forest products and wildlife resources were reported to have deteriorated. Also livelihood capital of financial, human and physical did not improve among the EPWS participating respondents. The most preferred incentive package by the respondents was mentioned to be sustainable land use, access to forest goods and services, improved extension services, access to inputs and agricultural commodity markets. For sustainability of the EPWS programmes, incentives packages should reflect the opportunity cost of abandoning the ongoing land use practices by the communities. The package should also take into account people’s choice and preferences.enConservationPayment for environmental servicesLivelihoodsTanzaniaAfricaJournal Article, Peer Reviewed