This report discusses the important role small tanks play in Sri Lanka. It presents the different services that small tanks provide. The IUCN Sri Lanka Country Office, in collaboration with the Mahaweli Authority implemented a project on integrating wetland economic values into river basin management. The project used the Kala oya basin as a pilot demonstration site. This report gives the reader an in-depth understanding regarding background and the nature of the Kala oya site. It individually looks at the resources and services provided by the tanks in the Kala oya basin. The report presents data and analyses regarding the economic valuation of the direct uses and assesses the use of the indirect services provided by small tank ecosystems. Based on the case study and on the information provided the report presents conclusions on the benfits of small irrigation tanks and their economic value.