This paper reports on research undertaken for the Government of Tanzania to investigate the case for the introduction of user charges in the health services. A parallel report is being completed on the potentiality of compulsory health insurance for those in regular employment. Five studies were undertaken at the national level. The main studies were interviews of nearly 900 outpatients at the main hospitals and interviews with over 1800 households all over the country with access to both government and mission hospitals. Information was collected on travel time, travel cost, and waiting time, which health facilities were chosen and why, the cost of using them, and difficulty in finding the money to pay and willingness to pay user charges. The most important conclusion was that because of inadequate supples of drugs and of food at hospitals many patients had to incur substantial costs to use the 'free' services in addition to travel costs. It is therefore concluded that modest charges, with attempts to exempt the poor, would be less inequitable than the existing situation, if the revenue could be used to ensure that supplies were always adequate at government health services. The level of charges suggested was based on what the majority surveyed said they were willing to pay.