This study focus on address challenges and opportunities confronting small business in Tanzania, Aim is to examine the causal relationship between small business and the magnitudes of its  investment, magnitude of small business with the levels of income, magnitudes of small business and levels of employments and magnitudes of small business with macro-economic policies. A total number of 450 small businesses were chosen. 95% of the businesses in Tanzania are small business and they are representing more than 35% of the country GDP.