The paper examines the use of the contingent valuation method to study the determinants of
rural households’ willingness to pay (WTP) for safe water in Kwara State. A sample of 120 households
was surveyed and a Tobit model was applied to explain household preferences for quality and quantity of
domestic water supply and derive estimates of WTP for such a service. The results confirm that
household age had a negative and statistically significant impact on WTP for both quantity and quality.
Income, water consumption and water source are positively associated with WTP for better quantity but
with a negative sign. This implies that the more the income, water consumes, water source, the less that
household would be WTP for better water quantity. Willingness to pay for improved water quality is
positively related to waiting time and education. Rural households showed a much higher WTP for better
water quantity than for improved water quality. There is therefore scope to improve water service levels
in the study area.