Government of India launched (April 2005) the National Rural Health Mission (NRHM) to carry out necessary architectural correction in the basic health-care delivery system. The Plan of Action includes increasing public expenditure on health, reducing regional imbalance in health infrastructure, decentralization and district management of health programmes, community participation and operationalising community health centres into functional hospitals. The performance audit review of implementation of NRHM in Jammu and Kashmir showed that the status of health profile of the State has been quite encouraging vis-à-vis the performance indicators available for the country. These can be further improved if there is proper fund management/utilisation and various sectors involved are covered in conformity with the guidelines issued for implementation of the Programme. There are large gaps in planning as well as implementation of the Mission activities in the State even after four years of launching the programme. This is evidenced by the findings that no new health centre was put in place, essential services and amenities were not available in many centres and there was critical shortage of technical manpower. Maternal and child health programmes have not made much headway. Planning, implementation and monitoring of the programme through participation of NGOs and community-based organisations was nonexistent.