Background: This study was set to determine the effect of project monitoring and evaluation on the implementation of funded potato projects in the Kabale District. Monitoring and evaluating a strategic role of communities that equips potato project beneficiaries to feel that they have a stake in the project. However, monitoring and evaluation activities by the communities have not been entirely accepted by donors. Objective: This study was set to determine the effect of project monitoring and evaluation on the implementation of funded potato projects in the Kabale District. Methods: This study adopted a descriptive survey design, and it used potato farmers as the unit of analysis. Data was collected in the means of administering a questionnaire survey from a sample of 196 potato farmers. Structural equation modeling was used to test hypotheses. Results: Findings revealed that project monitoring and evaluation have significant positive relationship sustainability of funded potato projects Conclusion and Recommendations: The study concludes that; Project monitoring and evaluation should be participatory. Therefore, the study recommends that project beneficiaries should share information concerning their project, collect data together and learn lessons from the project report and disseminate data for purposes of understanding very well the project