Provision of primary education for all children has long been seen as of great importance, at least in policy discussions, around the world and in Kenya. Since the introduction of free primary education, the Kenyan government has continued to invest heavily on the program for its sustainability and realization of the UN Millennium Development Goals and the Education for All goals. This has largely been realized through the introduction of capitation grants, which is Money for day to day running of the school provided by the ministry of education. It is important to understand the extent to which this capitation grant has affected service delivery in primary schools. The purpose of the study was to investigate the effects of capitation grant on implementation of free primary education in Seme Sub-County. The study was guided by Human Capital Theory and research objectives; to find out the effects of capitation grant on availability of instructional materials; to investigate the effects of capitation grant on availability of infrastructural facilities; to determine effects of capitation grant on retention rate and to examine effects of capitation grant on academic performance. The research design was descriptive survey. The sample size of 86 and 269 were determined using R.V Krejcie and D.W Morgan (1970) table. Head teachers were chosen purposively, while teachers were chosen through simple random sampling technique. research tools ; Questionnaires, document analysis and interview guide were used to obtain both quantitative and qualitative data. Reliability use of test retest and Validity use simple and clear items Quantitative data was analyzed by descriptive and inferential statistic with the help of SPSS version 22 to compute the data, while qualitative data was analyzed thematically. The study found that capitation grant had facilitated the availability and adequacy of instructional materials that encouraged quality learning. Rennovated infrastructural facilities creating conducive environment for learning. Pupils were able to enroll and attend schools without interruption regardless of their socio-economic background. The research revealed that capitation program influences positively the academic performance of the pupils. The study recommends that school stakeholders should work in collaboration when it comes to identifying and budgeting for the learning materials to be purchased. The government should consider adjusting upwards the amount allocated to schools to enable the school managers work efficiently and effectively for good results. Further research should be done on factors affecting proper utilization of capitation grant on implementation of free primary education.