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Background: Decentralization has been a prominent strategy to enhance health systems’ efficiency, service quality, autonomy and accountability in low- and middle-income countries (LMICs) like Tanzania since the 1990s. Previous studies have mainly focused on assessing how much power for decision-making on different health system functional areas is granted to local-level authorities from the central government and the interconnections between decision space, organizational capacity, and accountability mechanisms. Empirical evidence on its impact on performance remains limited. This study investigates conditions for good performance in a decentralised health system of Tanzania.

Methods: We used fuzzy set qualitative comparative analysis to analyse the necessary and sufficient conditions for good health system performance. Eighteen purposively districts were chosen to capture variations in performance and geography in a multiple case study approach.

Results: Functional Health Facility Governing Committees (HFGCs) emerged as a necessary condition for good performance. To achieve good performance, however, there is a need for functional decision space among managers or high accountability among managers or high capacity of staff/ okay level of staffing.

Conclusion: The study underscores the importance of the interplay between decision space, organizational capacity, and accountability in improving health system performance. While decentralization aims to provide greater autonomy, effective implementation depends on the development of local capacities and oversight through accountability. Decentralization alone is not sufficient to enhance healthcare delivery; HFGCs and their local context that promote (social) accountability are essential. Further research is warranted to identify interventions supporting HFGCs in fulfilling their mandates and enhancing health service delivery.