Groundwater is a natural resource of the earth that sustains and supports domestic, agricultural and industrial activities. It is distributed fairly and evenly throughout the world and over half of the world’s population depends on groundwater for drinking water supplies. Its usage is increasing due to rapid population growth, high rate of urbanization, industrial growth and agricultural utilizations. This has resulted to rapid depletion of groundwater which leads to water stress and degradation of these resources. The situation is further worsened by inadequate information on groundwater resource which has been and is still a big obstacle to the proper management of these resources. Remote sensing and GIS techniques have emerged as very effective and reliable tools in the assessment, monitoring and conservation of groundwater resources. This paper has made an attempt to identify and delineate groundwater potential zones in Lake Chala Basin in Kenya using Remote sensing and GIS. In the process of groundwater delineation in the area, different thematic maps on lithology, land use/land cover, drainage density, slope and rainfall were prepared, assigned with different weighting values as per their importance on groundwater occurrence and overlaid using spatial analyst tool in ArcGis 10 to generate groundwater potential map. The generated groundwater potential zone map was classified into four groundwater potential zones namely, very high, high, moderate and low. The study revealed that the area has very high groundwater potential. The generated groundwater potential map will be used for further groundwater exploration, proper planning, sustainable utilization and management of groundwater resources in the Lake Chala Watershed.