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This chapter investigates the status of e-Government development, explores the opportunities created for citizens and government, and identifies the challenges for an effective implementation of e-Government in Sri Lanka. The study reveals that the dissemination of public information online, the provision of call centre services, and the establishment of tele-centres in rural areas have generally improved the wellbeing of citizens. It further shows that the development of information and communication technology infrastructure and the taking of the human resource capacity building initiative in public organizations have had a positive impact on the performance of public organizations. The study, however, reveals that the continuous development of e-Government in Sri Lanka is troubled by the uneven access of rural citizens to e-Government services, the low e-Readiness of citizens, the delay in implementing major e-Government projects, and the insufficient funding for successfully implementing all the e-Government initiatives.