This research was carried out to find out the challenges of student retention at Mashonaland East Region. Two hundred and sixteen students responded to the questionnaire which was the research instrument utilised over and above the document analysis which was also used. Purposive and snowball sampling methods were used to select the respondents. Student enrolment statistics at the ZOU - Mashonaland East Regional Centre experienced the worst decline (40%) in 2009 between the first and second semester due to socioeconomic and political challenges prevailing in the country then. From 2010 the enrolment has maintained a steady decline due to financial challenges faced by students as a result of depressed salaries and institutional - related factors such as of unfriendly management policies that have impacted negatively on accessibility, affordability, flexibility and cost effectiveness of Open and distance learning provision. The rate of decline in enrolment varied according to programmes. Financial challenges caused by low salaries and unfriendly fees policy was cited by almost 92% of the respondents as the major cause of student dropout. Institutional - related factors such as tutoring, communication, library services and fees policy were said to be ineffective, thereby leading students to dropout. Students preferred Block release and the Lecture method to Tutoring which they said was in effective. The study recommended that the university should offer credit for prior learning, offer online classes and discuss cost payment plans as students start their studies with the college