A common characteristic of water utility and wastewater companies in developing countries is management problems and limited commercial vocation Public participation (PP) is increasingly expected to enhance the effectiveness of water utility and wastewater companies management.The concept of public participation in the small and medium-sized towns and cities has been evolutionary for the resent years,particularly in waste water treatment and water supply project.Now,the waste water treatment and water supply project is widely developing for alleviating local water pollution in the small and medium-sized towns and cities of China.Participation in environmental protection in these areas was just being at starting stage,environmental propaganda and education which aiming at residents in small and medium-sized towns and cities were few,and the activities of environmental protection lagged,relative to big cities.These made public participation in the small and medium-sized towns and cities has own characteristics.This paper discusses the characteristics of public in the small and medium-sized towns and cities participation in waste water treatment and water supply project,the factors that affect the degree of public participation.It analyses the existing problems,and proposes the corresponding improvement scheme in order to enhance the effectiveness of project management and better serves for local residents through public participation.