Abstract: Political risk is the risk that an investment's returns could suffer as a result of political changes or instability in a country. This paper seeks to explore the political risks that affect the mining industry in Kenya. Kenya has a wide variety of minerals which are known and mapped, but most of its potential lies in the yet undiscovered mineral deposits. In Kenya mining industry, local government plays not only a role of administrator and supervisor, but also a role of special interests subject in some cases.