Leadership has received much attention in both the business world and education. My thesis explores effective educational leadership through examining the management and leadership challenges that face principals in a multi-grade school. Schools in sparsely populated rural areas in Namibia have had to resort to multi-grade teaching to be able to be economically viable. Hard economic realities force people to move to bigger towns and cities. The constant demand for better schools, effective principals, qualified teachers and an improved service to the communities coupled with the demand for better working conditions and salaries for teachers drained the education budget even further. To keep in line with the four major policies of education namely equity, access, quality and democracy, the operation of smaller, rural multi-grade schools has become a necessity. The alternative - which is to close smaller schools and operate fewer, bigger schools at an affordable and reasonable cost - would deny rural communities access to schooling. This thesis is a case study of the leadership and management challenges of multigrade schooling in a single school. The goal was to understand how education managers and leaders perceived their role in making it possible for teachers and learners to cope with multi-grade teaching. I worked in the interpretive paradigm to be able to interpret the social and cultural context of a rural, multi-grade school in the Karas region. The methods included questionnaires, interviews and observation. One of the leadership models universally considered to be available to principals of multi-grade schools is instructional leadership. My study revealed that the concept was unknown to teaching staff, although there were indications that the model had been encountered. My findings also revealed that the communication between colleges of education and the regional education department staff was very limited. One of the major issues that arose was that principals were so occupied with teaching that important issues about training/evaluation and supervision of teachers, the 'visibility' of the principal, setting and implementation of the aims and goals of the school and regular communication with parents and community leaders were neglected. Probably the most significant finding was that head teachers are not trained in the management of a multi-grade school, hence most if not all of the head teachers run multi-grade schools like a single-graded school. The single most important problem was that the importance of multi-grade teaching had never been highlighted, particularly in light of new staffing norms, in spite of the fact that it was a phenomenon that was likely to be a permanent arrangement.