The flow regime of River Tana has been altered by a number of socioeconomic activities upstream. Modification of the flow regime of the river has had significant effects on the natural resources allied to the river, its economy and the general welfare of people. The study aimed at establishing the social and economic causes and impacts of modification of the Tana River flow regime. Results indicated that the main causes of modification of River Tana flow regime include hydropower generation, irrigated agriculture, abstraction of water for domestic and industrial use, and pastoralism. The demand for hydropower and food has also increased following the 35% increase in population between 1999 and 2009. The socio-economic impacts of modification of River Tana flow regime have been manifested in freshwater shortage downstream particularly during drought periods. Low levels of water flow in the river during the long drought periods put considerable constraints on irrigation activities. The freshwater shortages have further resulted in confrontations between pastoralists and crop farmers over grazing areas and watering points leading to loss of lives. Waterborne health disorders arise from unsafe water sources and affect human communities. It is recommended that investments should be channeled towards water treatment programs for the population in this area. There is need to come up with appropriate integrated resource management for sustainable utilization and management of water and land resources in the basin. The arid areas still remain the most significant source of beef and other livestock products hence there is need to provide water services to reduce conflicts with other demanding sectors especially competition for watering points.