The system of government resembles that of a British crown colony. At the head of the administration is a governor, who has a deputy styled lieutenant-governor, provincial commissioners presiding over each province. There are also executive and legislative councils, unofficial nominated members serving on the last-named council. In the "ten-mile strip" (see below, History), the sultan of Zanzibar being territorial sovereign, the laws of Islam apply to the native and Arab population. The extra-territorial jurisdiction granted by the sultan to various Powers was in 1907 transferred to Great Britain. Domestic slavery formerly existed; but on the advice of the British government a decree was issued by the sultan on the 1st of August 1890, enacting that no one born after that date could be a slave, and this was followed in 1907 by a decree abolishing the legal status of slavery. In the rest of the protectorate slavery is not recognized in any form. Legislation is by ordinances made by the governor, with the assent of the legislative council. The judicial system is based on Indian models, though in cases in which Africans are concerned regard is had to native customs. Europeans have the right to trial by jury in serious cases.
There is a police force of about 2000 men, and two battalions of the King's African Rifles are stationed in the protectorate. Revenue is derived chiefly from customs, licences and excise, railway earnings, and posts and telegraphs. Natives pay a hut tax. Since the completion of the Uganda railway, trade, and consequently revenue, has increased greatly. In 1900-1901 the revenue was £64,275 and the expenditure £193,438; in 1904-1905 the figures were: revenue £154,756, expenditure £302,559; in 1905-1906 the totals were £270,362 and £418,839, and in 1906-1907 (when the railway figures were included for the first time) £461,362 and £616,088. The deficiencies were made good by grants-in-aid from the imperial exchequer. The standard coin used is the rupee (16d.).
Education is chiefly in the hands of the missionary societies, which maintain many schools where instruction is given in handicrafts, as well as in the ordinary branches of elementary education. There are Arab schools in Mombasa, and government schools for Europeans and Indians at Nairobi.
From the 8th century to the 11th Arabs and Persians made settlements along the coast and gained political supremacy at many places, leading to the formation of the so-called Zenj empire. The history of the coast towns from that time until the establishment of British rule is identified with that of Zanzibar (q.v.). The interior of what is now British East Africa was first made known in the middle of the 19th century by the German missionaries Ludwig Krapf and Johannes Rebmann, and by Baron Karl von der Decken (1833-1865) and others. Von der Decken and three other Europeans were murdered by Somali at a town called Bardera in October 1865, whilst exploring the Juba river. The countries east of Victoria Nyanza (Masailand, etc.) were, however, first traversed throughout their whole extent by the Scottish traveller Joseph Thomson (q.v.) in 1883-1884. In 1888 Count S. Teleki (a Hungarian) discovered Lakes Rudolf and Stefanie.
The growth of British interests in the country now forming the protectorate arises from its connexion with the sultanate of Zanzibar. At Zanzibar British influence was very strong in the last quarter of the 19th century, and the seyyid or sultan, Bargash, depended greatly on the advice of the British representative, Sir John Kirk. In 1877 Bargash offered to Mr (afterwards Sir) William Mackinnon (1823-1893), chairman of the British India Steam Navigation Company, a merchant in whom he had great confidence, or to a company to be formed by him, a lease for 70 years of the customs and administration of the whole of the mainland dominions of Zanzibar including, with certain reservations, rights of sovereignty. This was declined owing to a lack of support by the foreign office, and concessions obtained in 1884 by Mr (afterwards Sir) H.H. Johnston in the Kilimanjaro district were, at the time, disregarded. The large number of concessions acquired by Germans in 1884-1885 on the East African coast aroused, however, the interest of those who recognized the paramount importance of the maintenance of British influence in those regions.
A British claim, ratified by an agreement with Germany in 1886, was made to the districts behind Mombasa; and in May 1887 Bargash granted to an association formed by Mackinnon a concession for the administration of so much of his mainland territory as lay outside the region which the British government had recognized as the German sphere of operations. By international agreement the mainland territories of the sultan were defined as extending 10 m. inland from the coast. Mackinnon's association, whose object A chartered company formed. was to open up the hinterland as well as this ten-mile strip, became the Imperial British East Africa Company by a founder's agreement of April 1888, and received a royal charter in September of the same year. To this company the sultan made a further concession dated October 1888. On the faith of these concessions and the charters a sum of £240,000 was subscribed, and the company received formal charge of their concessions. The path of the company was speedily beset with difficulties, which in the first instance arose out of the aggressions of the German East African Company. This company had also received a grant from the sultan in October 1888, and its appearance on the coast was followed by grave disturbances among the tribes which had welcomed the British. This outbreak led to a joint British and German blockade, which seriously hampered trade operations.
It had also been anticipated, in reliance on certain assurances of Prince Bismarck, emphasized by Lord Salisbury, that German enterprise in the interior of the country would be confined to the south of Victoria Nyanza. Unfortunately this expectation was not realized. Moreover German subjects put forward claims to coast districts, notably Lamu, within the company's sphere and in many ways obstructed the company's operations. In all these disputes the German government countenanced its own subjects, while the British foreign office did little or nothing to assist the company, sometimes directly discouraging its activity. Moreover, the company had agreed by the concession of October 1888 to pay a high revenue to the sultan - Bargash had died in the preceding March and the Germans were pressing his successor to give them a grant of Lamu - in lieu of the customs collected at the ports they took over. The disturbance caused by the German claims had a detrimental effect on trade and put a considerable strain on the resources of the company.