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Ethiopia has great agricultural potential as it has vast area of fertile land, diverse climate, sufficient annual rainfall, & abundant labor force. However, the current performance of agric. is far below the potential, partly due to soil erosion & land degradation, lack of using improved technologies, lack of supportive services, poor socioeconomic infrastructure, & many more interrelated socioeconomic factors. Consequently, food insecurity & poverty have remained common features in the rural community. However, given the great natural resources endowment there is immense possibility to improve agricultural productivity & livelihood of the people by unlocking the potential of the rainfed agricultural system through integrated watershed development approach.