In 1968, the government initiated a smallholder tea development program in which all aspects of smallholder tea marketing and trade were turned over to the Tanzania Tea Authority which assumed a wide array of responsibilities. The Authority promoted smallholder tea production. Most of the smallholder tea leaf went to the eight Tea Authority-owned factories for processing, and the rest to factories owned by the estates. Despite its apparent success, there were numerous signs of distress in the smallholder sector. This note describes the constraints and challenges faced by the production of tea in Tanzania.