This report is intended to provide abase for discussions of Yemen's health sector strategywith the Government of Yemen (GOY) and other donors in lightof the Ministry of Public Health (MOPH) initiative of HealthSector Reform (HSR) as well as the potential areas of WorldBank support. The report is divided in nine sections.Section A provides the introduction to the report and thecountry context. Sections B and C review the key healthindicators and trends and the key aspects of the sector interms of financing, service delivery, human resources,health services, organizational framework, and policyenvironment. Sections D and E provide internationalcomparisons and an assessment of the sector performance withregard to health outcomes, equity, access, efficiency,quality, and sustainability. Section F is an outline of theMOPH/HSR program. Sections G and H provide an overview ofthe Bank's current assistance and its response to HSRas well as the different donors' support. Finally,Section I outlines the future areas where the Bank cansupport the government in its health reform efforts. Yemenfaces major challenges to improving the health status of itspopulation, which go beyond the health delivery network.Poverty, low participation in education especially amonggirls, and high illiteracy are major contributing factors topoor health as are limited access to potable water andproper sanitation.