Poor waste management in the Kathmandu valley has deteriorated the water quality of surface and groundwater sources. The objective of this study was to assess the status of water quality (WQ) in drinking water sources of groundwater and municipal supply (tap water) from the Bagmati river basin in Kathmandu valley. A total of 52 water samples from deep tube-well, tube-well, dug-well, and tap water were collected and analyzed for physical, chemical, and microbiological parameters using standard methods. The results revealed that chloride, total hardness (TH), copper, nitrate, sulfate, and turbidity were within the recommendations of the National Drinking Water Quality Standard (NDWQS). Total coliform (TC) bacteria in 84.6% of the samples exceeded drinking water guidelines. Similarly, the isolates of different enteric bacteria, namely Escherichia coli (21.5%), Citrobacter spp. (20.9%), Klebsiella spp. (19.8%), Proteus spp. (13.9%), Enterobacter spp. (8.72%), Salmonella spp. (5.8%), Shigella spp. (5.2%), and Pseudomonas (4.1%) were identified in the samples collected from the respective sources. Out of the 52 water samples, 7.7% of samples had fecal contamination of somatic coliphage. The groundwater and municipal water supply in the study area are not safe for drinking purposes. Treatment of water is required before its use for household applications.