The small hydropower system is one of the most effective renewable sources of energy for sustainable development. This paper presents the hydropower basic energy main elements in a small hydro scheme, site location, and flow duration curve in relation to assessing power and energy requirement in a small hydro system. The capital cost of small hydro plants compared to other options of power supply and the financial profitability of small hydro are also discussed. Improving air quality and public health by reducing greenhouse emissions and increasing reliability of power supply with cheaper cost de-centralized or distributed generation are some of the outcomes achieved from small hydro system. Finally, strengthening national policy frameworks and the integration of hydro energy, enhancing national capacity for research and development and transfer and diffusion of small hydro energy technologies, establishing markets for small hydro, increasing access to finance and establishing enterprise for installing operating, and maintaining small hydro energy are some of the way forward to sustainable development using small hydro system. (Keywords: sustainable development, hydropower, electricity demand)