Most developing countries such as Tanzania are capital deficient and therefore seek to attract foreign direct investment (FDI) to bolster economic growth and consequently economic development. This study seek to examine the casual relationship between Foreign Direct Investment and Economic Growth in Tanzania, Secondary data were used in the analysis from UNCTAD database, IMF world economic outlook, World Bank quick query (data section) and UN COMTRADE database. The period of analysis was 1971 to 2005; OLS regression was used to ascertain the relationship between FDI and Economic Growth. The result shows that the FDI in Tanzania contribute positively to the Economic Growth.
