This study analyzes the willingness to pay for improved water supply services by households forrnHaik town. The Contingent Valuation Method (CVivf) was utilized to obtain estimates ofrnWillingness to Pay (WTP) for improved domestic water supply services to current and futurerngenerations. Analysis of bid function underlying the WTP re.ljJonses was undertaken, with arnrange of explanatory variables being investigated In this contingent valuation survey, wernadopted a dichotomous choice with follow-up debrieflng questions, as well as open-endedrnfollow-up question to model individual's WTP. Descriptive analysis as well as two analyticalrnmodels namely Tobit and Probit model and Ordinmy Least Squares (OLS) were used A samplernof 145 household heads was taken. We used stratified sampling method followed by simplernrandom sampling to select the required sample. The survey was conducted using a face- to- facerninterview to the selected sample of household heads. The study results show that the meanrnannual WTP of Total Economic Value (TEV) of improved domestic water supply services isrnabout 239.28 Birr per annum, which seems to be 0 significant amount based on keyrnsocioeconomic explanatory variables suggested by economic theory. The mean WTP values arern24.75 and 27. 37 cents per Baldi (a 20 liter bucket) for the improved water supply service asrncalculated Fom the Tobit and Probit models, respectively. The total WTP amount Fom the totalrnof 4,590 households in the study area of Haik town is Birr 1,136.03 per Baldi or Birr 4,544.12rnper a day at average service lee of 24. 75 cent per Baldi. Accordingly, the mean WTP is unlikelyrnto be a realistic value that can gauge the TE V of improved domestic water supply services.rnHowever, the study also shows that the TEV of improved domestic water supply services is likelyrnto be difficult to estimate.rnKeywords: Contingent valuation method; Economic value; Willingness to Pay; Domestic waterrnsupply services; Haik town.