Generative artificial intelligence (GenAI) is entering higher education systems across Africa at a pace that outstrips institutional preparedness, yet empirical evidence from small, resource-constrained island settings remains absent from the literature. This study examined GenAI perceptions, readiness, and preparedness among higher education participants in Zanzibar, Tanzania, a small island system with no prior documentation in the technology adoption literature. A convergent mixed methods design was employed: 235 participants (192 students and 43 lecturers) from four institutions completed a structured online questionnaire, providing both Likert-scale responses analysed via partial least squares structural equation modelling (PLS-SEM) and open-ended responses analysed using reflexive thematic analysis. PLS-SEM results showed that perception strongly predicted readiness (β = 0.849, R² = 0.722) and that readiness was the primary mechanism linking perception to preparedness (indirect β = 0.822; total effect β = 0.355, p < .001). Thematic analysis of 235 open-ended response sets yielded ten themes spanning infrastructure deficits, skills and digital literacy gaps, absent institutional policy, financial barriers, cognitive risks, and broadly positive orientations toward AI’s educational potential. Integration of the two strands showed that structural factors–unreliable internet, insufficient ICT resources, and the absence of institutional governance frameworks–explain why positive perceptions and readiness do not automatically translate into preparedness. These findings challenge simplified adoption models that treat psychological variables as sufficient and demonstrate that in low-resource island contexts, awareness and motivation require concurrent investment in infrastructure, training, and institutional policy to produce genuine implementation capacity. The practical implications for Zanzibar higher education sector and comparable systems across the Global South are discussed.