Delay in the delivery of materials and equipment to construction sites is often thought of as a contributory cause of cost overruns in construction projects in developing countries. A cursory examination of the environment in which projects are executed in developing countries appears to support this thinking. However, there does not seem to have been much research work conducted that investigates whether this is actually the case and also assesses the causes of these delays and magnitude of their impacts on project costs. This research was aimed at firstly ascertaining the occurrence of material and equipment procurement delays in highway projects in Nepal. An assessment of the causes of the delays and the magnitude of their impact on project costs was also made. The survey method was used in conducting this research involving 22 highway projects. The main causes of material and equipment procurement delay were found to be (in rank order) organizational weaknesses, suppliers’ defaults, governmental regulations and transportation delays. However, the actual impact of these delays on project costs was found to be on average, only about 0.5% of the total budgeted cost of the projects. Among materials, delays in the supply of aggregates were found to occur most frequently while delays associated with pavers occurred most frequently among equipment.