This study was conducted to examine perceptions of the farmers and key informants on the use of low-quality irrigation water for vegetable production in urban and peri-urban areas in Morogoro, Tanzania. The methods used to collect data were farmer surveys (n = 60), focus group discussions (n = 4) and key informants interviews (n = 15). The results showed that the respondents had a positive perception on using low-quality irrigation water for vegetable production. The reported benefits include availability of water throughout the year, highest soil and crop nutrients in irrigation water, less costs of buying commercial fertilizers, vegetable production all year round, sustainable income generation from selling vegetables and also jobs creation in the community among farmers and vegetable sellers. Findings from Mann–Whitney U test and Kruskal–Wallis test score on farmers perception scales indicate an association between the source of low-quality water used and the respondents’ sex. Accordingly, female farmers had higher positive perception on the benefits of low-quality water compared to male farmers. Higher perception score was also observed among farmers who used polluted river water in irrigation vegetable production compared to farmers who used wastewater. Since low-quality irrigation water is a good strategy of coping with scarcity of freshwater for communities which have no alternative source of irrigation water, the study recommends multi-sectorial agencies across the country to be involved in formulating policies and creating health promotion awareness for safe use of low-quality water for benefit maximization and health risk reduction.