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Background Studies show that the burden of malaria remains huge particularly in low-income settings. Although effective malaria control measures such as insecticide-treated nets (ITNs) have been promoted, relatively little is known about their equity dimension. Understanding variations in their use in low-income settings is important for scaling up malaria control programmes particularly ITNs. The objective of this paper is to measure the extent and causes of inequalities in the ownership and utilisation of bed nets across socioeconomic groups (SEGs) and age groups in Tanga District, north-eastern Tanzania. Methods A questionnaire was administered to heads of 1,603 households from rural and urban areas. Households were categorized into SEGs using both an asset-based wealth index and education level of the household head. Concentration indices and regression-based measures of inequality were computed to analyse both vertical and horizontal inequalities in ownership and utilisation of bed nets. Focus Group Discussions (FGDs) were used to explore community perspectives on the causes of inequalities. Results Use of ITNs remained appallingly low compared to the RBM target of 80% coverage. Inequalities in ownership of ITNs and all nets combined were significantly pro-rich and were much more pronounced in rural areas. FGDs revealed that lack of money was the key factor for not using ITNs followed by negative perceptions about the effect of insecticides on the health of users. Household SES, living within the urban areas and being under-five were positively associated with bed net ownership and/or utilisation. Conclusion The results highlight the need for mass distribution of ITN; a community-wide programme to treat all untreated nets and to promote the use of Long-Lasting Insecticidal nets (LLINs) or longer-lasting treatment of nets. The rural population and under-fives should be targeted through highly subsidised schemes and mass distribution of free nets. Public campaigns are also needed to encourage people to use treated nets and mitigate negative perceptions about insecticides.