As a result of the free education policy (1947) and introduction of Sinhala and Tamil languages as the medium of education, Sri Lanka achieved universal primary education by 1964, then 92% of literacy rate, gender parity and the third Millennium Development Goal of eliminating disparities in enrolment in education. However, present education system faces several major challenges related to poor quality, mismatch of curriculum with existing labour market demands, lack of training for school teachers and inefficient administration. Not only the limited government expenditure on education, but also factors like lack of clear national/state educational policy, un-planned policy changes done by the political leaders from regime to regime, politicization of recruiting procedures of school teachers and administrative staff, lack of proper teacher training, and some recent educational reforms mainly based on foreign donor agencies but not on real needs of the country have been pointed out as main factors for the deterioration of the education system by moderate educationist, researchers and policy makers in Sri Lanka.