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This paper assesses the quality and extent of provision for water and sanitation in urban areas in Malawi - where over 60% of the population lives in informal settlements. It also considers whether the Millennium Development Goals (MDGs) for water and sanitation are likely to be met in Malawi, and examines the current and potential role of community-led sanitation improvements. It includes recommendations for interventions needed by governmental, international and civil-society organizations to improve living conditions of communities to contribute to the realization of the MDGs.