Population distribution in Tanzania is extremely uneven. Density varies from 1 person per square kilometer (3 per sq. mi.) in arid regions to 51 per square kilometer (133 per sq. mi.) in the mainland's well-watered highlands to 134 per square kilometer (347 per sq. mi.) on Zanzibar. More than 80% of the population is rural. Dar es Salaam is the capital and largest city; Dodoma, located in the center of Tanzania, has been designated the new capital, although action to move the capital has stalled.

The African population consists of more than 120 ethnic groups, of which the Sukuma, Haya, Nyakyusa, Nyamwezi, and Chaga have more than 1 million members. The majority of Tanzanians, including such large tribes as the Sukuma and the Nyamwezi, are of Bantu stock. Groups of Nilotic or related origin include the nomadic Masai and the Luo, both of which are found in greater numbers in neighboring Kenya. Two small groups speak languages of the Khoisan family peculiar to the Bushman and Hottentot peoples. Cushitic-speaking peoples, originally from the Ethiopian highlands, reside in a few areas of Tanzania.

Although much of Zanzibar's African population came from the mainland, one group known as Shirazis traces its origins to the island's early Persian settlers. Non-Africans residing on the mainland and Zanzibar account for 1% of the total population. The Asian community, including Hindus, Sikhs, Shi'a and Sunni Muslims, and Goans, has declined by 50% in the past decade to 50,000 on the mainland and 4,000 on Zanzibar. An estimated 70,000 Arabs and 10,000 Europeans reside in Tanzania.

Each ethnic group has its own language, but the national language is Kiswahili, a Bantu-based tongue with strong Arabic borrowings.