The author focuses on how development-oriented non-governmental organizations (NGOs) and microfinance institutions (MFIs) are suited to the dual development process of improving the wellbeing and empowerment of the poor and other marginalized peoples (especially women) in Africa and other developing countries, focusing on Uganda. NGOs and MFIs are seen as a third approach (i.e. an alternative to state or market strategies) to achieving sustainable development and poverty reduction. The author discusses the following central issues: rethinking development strategies in Africa as a result of the failure of the state or market to deliver economic growth and poverty reduction, and the rise of the NGO sector to fill the vacuum; clarification of the on-going confusion between MFI performance and impact assessment; the inadequacy of economic reforms in Uganda to benefit the rural agricultural producers; NGOs and MFIs in Uganda as part of the development strategy and their potential to spur development; the commercialization of MFIs and its implications; lessons from successful MFIs in Uganda and globally; and an analysis of how NGOs and MFIs working together with the public and private sectors (in a triple partnership) can achieve sustainable development and poverty reduction in Uganda and other African countries.