A growing number of developing countries have devolved the responsibility for water and sanitation services to local government, in line with decentralisation of basic services. But local governments need support to take on this responsibility. While this is understood in theory, in practice the support provided has been inadequate. The challenge is to create robust and capable water and sanitation institutions at the decentralised level. This takes investment in training and on-going support. Unless national governments are willing to make this investment, rural water services are unlikely to improve, and the sector will remain stuck in a cycle of low capacity and service delivery failure. Capacity support refers to activities that support local government to fulfil its responsibilities. Such support includes the provision of technical assistance, performance monitoring, and training of staff around key functions, such as planning, financing for life-cycle costs, and monitoring. To be effective, support to local government requires a strong national sector strategy that: recognises diverse capacity needs, includes a dedicated budget for institutional support, and provides for capacity building and training.