Abstract Decentralization has been touted as being central to the promotion and realization of good governance in Uganda. The major objective of the study was to examine the role of decentralization in the promotion of good governance in Kanungu town council. The study used both qualitative and quantitative data collection methods in which questionnaires and observation were used to collect data from respondents. Research question one sought to find out the relationship between decentralization and good governance. Research question two sought to establish the challenge of decentralization policy in Kanungu town council. While research question three sought establish the solutions to the problems of decentralization policy. Conclusions and recommendations will then be made after presenting and interpreting the data.