This paper evaluates the social impact of the improved rural roads. Data is taken from a social impact assessment study carried out in the year 2001 along the improved (upgraded from earth to engineered gra el) Msata-Bagamoyo road in Coast Region, Tanzania. Data collection techniques employed were rapid rural appratsal of social services; in-depth interviews with a sample of households and secondary data. Results of the assessment reveal that the improvement of the road increased agricultural production, commercialization of agriculture and improved the timely availability of agricultural inputs to farmers. It has led to greater accessibility of markets, reduced transportation costs and enhanced food security. Other benefits are the growth in retail businesses d entrepreneurial spirit in the area, increased and efficient mobility, improved access to medical and health services and road safety. The challenges brought about by the improvement are increased rate of social stratification among individuals and between villages. Other challenges are increases in sexually transmitted diseases including HIV infections. The major conclusion drawn is that peasant farmers are rational economic beings and that rural roads play a significant role in the transformation of the agricultural sector in Tanzania.