1. Introduction Ethiopia with origin of humankind and coffee is one of the most ancient nations, characterized by diverse mix of ethnic and linguistic backgrounds, as well never colonized in Africa (Behru, 2002). Due to its long lasting feudal arrangement and military dictatorial regime, the people has been suffered with poverty and backwardness (MoC, 2000). To averse the situation and in place sustainable peace, good governance, and socio-economic advancement, political progress and to realize united Ethiopian people have been struggled for many years (Behru, 2002). After regime change in 1991, instituting a transitional government and endorsing a new constitution and officially elected government and leadership has introduced a developmental democratic state and bicameral parliamentary system with federal arrangements and devolution of power. Since then, the country has achieved fast economic growth and social and political progress with strong commitment, clear vision and mission, policies and strategy to become a country of middle-income whereby democratic rule and social justice reigns. Since mid-1990’s, the practices and development of leadership in Ethiopia can be characterized by inclusiveness, participatory and serving the people selflessness, emphasizing on team building, and collective decision making as the principal character and value of its leadership. The leadership has successfully achieved outstanding economic growth, securing peace and stability, enhancing rural and urban socioeconomic growth and built grand infrastructure to ensure socio-economic transformation (NPC, 2016). Nevertheless, Ethiopian leadership and its success are challenged by many external and internal factors such as corruption, nepotism and patronage network, tribalism and geopolitical conditions. Agricultural productivity and transformation are not enhanced as to the expectations in satisfying public demand. This leads to high unemployment rate and public discontent. This term paper attempts to critically examine leadership effectiveness in performing its mission in fostering socio-economic development and wellbeing. It also tries to evaluate factors that critically affect the execution and effectiveness in key leadership achievements. The paper is organized as follows: Part one of the paper presents some facts about Ethiopia, such as geographic, historical, demographic and political nature. It also discusses the governing structure and decision making systems with its strength and weakness. Part two presents critical evaluation of leadership practices and effectiveness based on the vision, mission, core values and characters of the current leadership. It also discusses about the overall economic performance, employment, poverty, corruption and its implications. Part three of the paper critically analyses the strength and weakness of Ethiopian leadership and major factors affecting its execution and effectiveness. Part four draws lessons to be learnt from the Chinese leadership practices and development. Finally, it summarizes concluding remarks.