Intensive explorations of different alternatives and renewable energy resources are currently being conducted worldwide. Pico-hydro power is at the forefront of these options because it is considered as the most cost-effective renewable energy option to provide electricity for rural areas, and to enable energy to be derived from extremely low head and flow streams of 1m and 1L/s, respectively. This review discusses the research and development aspects of pico-hydro and the factors influencing the success of the pico-hydro scheme in rural areas. These factors are also likely to increase the demand for pico in a rural energy market. This paper concurs with the view held by many researchers and experts that customs duty imposed on pico-hydro components is a major obstacle to the dissemination of renewable energy because it raises original cost by up to 40%. The future of the pico-hydro market looks prosperous because there is substantial availability of low head and flow hydroelectric sites in less developed countries. In the future, technology can play a crucial role in the lighting of houses in remote communities, with the energy source derived from domestic water supply.