Among critical stakeholders of software projects developed in public institutions are software developers and project managers affiliated to subcontractor companies, who are working onsite at the public institutions. The aim of this study is to identify, determine and have an initial understanding regarding how software developers are affected and what are the factors that effect software developers and project managers while working onsite in public software projects. The research is designed as an exploratory and qualitative study. The study participants were 10 software developers, one technical team leader and four project managers, all having long experiences in working on public software projects on client premises. Semistructured interview technique is employed as the data collection method and "content analysis" was applied on the obtained participant responses. Following this analysis, "key content" approach was used to identify the issues to be further considered. It has been determined that the productivity of software developers working onsite at public institutions is low due to intense requests, shortened time to fulfill these requests, and long duration of authorization processes. Moreover, a finding of the study is that the quality of the developed projects and the motivation of the developers are considered to be low for the same aforementioned reasons. Among the foremost causes for these results are the fact that employees work under two different hierarchical structures one in the public institution and one in the software company, more than one managers assign work and there is an authority confusion between organizational units and people in the public institutions.