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Lockdowns were a key policy response to the COVID-19 pandemic. While they were viewed as a necessary intervention, concerns were raised about their potential for harmful economic and livelihood impacts. However, few studies have addressed the unequal economic and livelihood impacts of lockdowns. Our article reports findings from a qualitative study conducted in Uganda on economic and livelihood impacts of COVID-19 lockdowns in urban and rural settings. This study used 14 focus group discussions, 40 household, and 31 key informant interviews in both urban (Kampala district) and rural (Wakiso district) areas in central Uganda. Data analysis was conducted thematically with NVivo 2020 (QSR International). The findings emphasize the unequal impacts of the COVID-19 lockdowns across a range of dimensions: informal sector activities, formal employment, fluctuating prices alongside scarcity and surpluses, food insecurity, and government interventions. Wealthier households in urban areas were least affected, with urban households reliant on informal sector activities experiencing the most significant impacts. Our findings also suggest that longer-term development strategies, such as increased food self-sufficiency and informal sector interventions can support future pandemic preparedness and response. To address these impacts, policymakers should provide targeted support, alongside protecting key productive sectors, and supply chains.