ABSTRACT The aim of the study was to establish the effect of effective contract management practice on the operational performance of state corporations in Uganda using the Uganda National Roads Authority as a case study. The specific objectives of the study were to determine the extent to which the Uganda National Roads Authority (UNRA) practices effective contract management; to identify the challenges that hinder effective contract management practice in state corporations in Uganda, and to identify the level of operational performance in UNRA. The study used a descriptive, cross-sectional survey research design, with a target population of all the 45 respondents. It also employed a simple random sampling method with a sample size of 40 respondents. Data was collected using questionnaires, analyzed using SPSS and presented using charts, tables, and graphs. The study findings indicated that UNRA practices effective contract management, which has a positive effect on their operational performance. The implication of the study is that effective contract management improves operational performance of state corporations in Uganda however, the study recommends constant training, improve contract management practices, use of adequate information systems and enhanced flexibility and risk management.