This paper discusses a significant illicit economy, including black and grey aspects, associated with medical waste scavenging and recycling in a megacity, considering hazards to the specific group involved in scavenging as well as hazards to the general population of city dwellers. Data were collected in Dhaka, Bangladesh, using a variety of techniques based on formal representative sampling for fixed populations (such as recycling operatives) and adaptive sampling for roaming populations (such as scavengers). Extremely hazardous items (including date expired medicines, used syringes, knives, blades and saline bags) were scavenged, repackaged and resold to the community. Some HCE employees were also observed to sell hazardous items directly to scavengers, and both employees and scavengers were observed to supply contaminated items to an informal plastics recycling industry. This trade was made possible by the absence of segregation, secure storage and proper disposal of medical waste. Corruption, a lack of accountability and individual responsibility were also found to be contributors. In most cases the individuals involved with these activities did not understand the risks. Although motivation was often for personal gain or in support of substance abuse, participants sometimes felt that they were providing a useful service to the community.