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The youth empowerment and community development in Kamunganguzi Sub-County,Kabale District, Uganda was evaluated. The aim of the study was to find out the Level of theyouth empowerment in rural areas, the effect of the informal economy to communitydevelopment and the extent of the youth empowerment to the National Development inKabale District. The survey research design was used. The researcher used both qualitativeand quantitative techniques in collecting and analyzing and presenting the data. The levelperformance of youth empowerment was; creating employment opportunities among theyouth, providing education through payment of fees, training the youth some of the skills,fighting poverty in the community, funding the activities of the youth which are incomegenerating, participated in the formation of policies on health, human rights affecting theyouth and capacity building by giving refresher courses to the youth. The factors affectingthe effective performance of Youth empowerment were; poor leadership, lack budgetingskills, lack of enough funds, lack of enough funds and the inability to define proper lines ofautonomy on policy issues, government interference