This study investigates the impact of credit risk and bank-specific drivers on the financial performance of commercial banks in Tanzania over ten years, from 2012 to 2022. Secondary data were collected from 25 commercial banks: ten large, ten medium-sized, and five small and regional banks. The Generalized Method of Moments (GMM) was employed to estimate coefficients and address potential endogeneity concerns. Credit risk was assessed through Non- Performing Loans (NPLs), Loan Loss Provisions (LLP), and Default Rates (DR), while asset quality, management efficiency (cost-to-income ratio, CER), and bank Liquidity Ratio (LR) were considered as bank-specific drivers. Return on Assets (ROA) was used as the measure of financial performance. The results revealed that NPLs and DR significantly affect ROA, while LLP exerts a significant positive impact. Furthermore, all bank-specific drivers were found to be significantly associated with ROA. These findings suggest that bank management should adopt effective strategies for managing credit risk and controlling bank-specific drivers to enhance financial performance. Financial regulators should also foster a stable financial environment by implementing monetary policies that lower NPL ratios and maintain strong liquidity positions, thus ensuring the competitiveness and resilience of commercial banks in Tanzania. The study provides empirical insights into the relationships among credit risk, bank-specific drivers, and financial performance in Tanzanian commercial banks.