The study investigated teachers’ perception regarding the effect of reward system on teachers’ performance at elementary level. This study was based on the Expectancy motivation theory. This theory is important in understanding that employees’ performance. A descriptive research design was adopted in this study. Self rated questionnaire was used to examine the effect of reward system on teachers’ performance. Data was collected through self rating Likert type scale. Total 200 teachers were selected as a sample from 20 elementary schools (i.e. 10 private schools and 10 public schools) in Lahore. The results of this study showed that reward system make a significant impact on performance of teachers at elementary level. The study made a significant contribution in revealing the relationships between reward system and teacher’s performance at elementary level.