This paper studies the effect of heterogeneous tissue conductivity in a human head model for the EEG forward problem. Firstly, the tissue heterogeneity in conductivity was characterised from measured data in the literature. Then a method was developed to include this feature in modelling. Finally, the effect of tissue heterogeneity on EEG signals was studied. Based on these studies the paper concludes that the inclusion of tissue heterogeneity is significant in accurate head modelling for the EEG problem.