A study was conducted to determine the factors influencing the supply of live indigenous (local) chickens in Kampala city markets in December 2008. A total of fifty local chicken traders were randomly selected from five markets to respond to a structured questionnaire. Chicken trade was generally informal. Local chickens were mainly marketed alive in Kampala markets and the main customers were piecemeal consumers. The majority of the traders (52.9%) obtained local chickens from Eastern Uganda. Chickens were transported to markets in passenger vehicles, on motorcycles and on lorry trucks that were carrying cattle and other agricultural produce. This mode of transport sometimes caused injuries and bird mortality. Fifty percent of the traders obtained the chickens from middlemen while 46% of the traders personally bought the birds from rural farm households. Chicken trade was the major source of household income to 72.7% of the chicken traders and many of the traders had secondary sources of income. During peak seasons, the traders could sell an average of 120 birds per week per person. Local chicken marketing involved traders of varying levels of education (with a mean of 9.5 years of formal education). The number of local chickens traded per week was positively correlated (P<0.01) with the level of education of the traders. The demand for these chickens was highest in the festive months of December and April; and lowest in February and March. The cost of local chickens was more than twice as much as that of exotic chickens. Most traders (56.7%) perceived taste to be the basis for consumers’ preferential demand for local chickens in preference to exotic chickens. The major constraints in the marketing of local chickens in Kampala city markets were identified as high mortality rates/chicken diseases (43.5%), costly transport (22.4%), and irregular demand (15.3%). The study revealed that there was a high potential for the development of local chicken trade in Uganda. Designing solutions for the constraints of local chicken marketing would act as a tool for poverty alleviation not only to the rural chicken farmers but also the traders.