The Centrally sponsored "National Aids Control Programme" was implemented with the aim to slow down the spread of HIV infection, reduce the future mortality and strengthen the capacity to respond to HIV/AIDS on a long term basis. The performance audit of National AIDS Control Programme in Andhra Pradesh revealed that the programme was not implemented effectively in the State. No physical targets were fixed for most of the components/ sub-components of the programme either by NACO or by the Society at State level. The Project Director of the Society failed to utilise the grants fully leaving certain major components unimplemented. Society did not set any parameters to assess the performance of NGOs and judge the success of their efforts. Functioning of NGOs in districts was not checked properly by the Society. While HIV prevalence rate among antenatal attendees reduced from 2.20 to 1.62 per cent the prevalence registered steep rise during 1998-2002 among STD clinic attendees. Up to 2001-02 the Society paid little attention for strengthening of STD clinics, establishment of modern blood banks and upgradation of the existing blood banks, delivery of condoms, etc. Resultantly, the incidence of HIV and AIDS cases increased. Monitoring of the programme was very poor.