This paper examines the development in the Nigerian road transport system with emphasis Oil major policy issues that have affected the performance of the sector. The study shows that the total length of roads has increased in quantity and quality since 1960, and as a result, the road transport system dominates passenger and freight traffic movement. Although over 90 percent of budget allocations to the transport sector is assigned to road development, most of the roads are in terrible state of disrepair. The road network has suffered from continued lack oft maintenance, poor design and construction, excessive use and inadequate financing of road projects by the federal, state and local governments. Policy recommendations that will improve the state of roads include geotechnical analysis of soils used as sub grade material during construction and maintenance phases, enforcement of regulations on driving and vehicle condition, regular road maintenance and rehabilitation and proper assessment of the technical and financial aspects of private=public partnership projects.