A review of the information on the HIV epidemic in Ethiopia is important to guide policy and action. Published and unpublished reports and surveillance data from records of governmental and non-governmental institutions were examined to assess the extent of the epidemic. It appears that the HIV/AIDS epidemic has affected a large segment of the urban population. Surveillance data from pregnant women attending antenatal clinics indicate a decreasing trend in the prevalence of HIV in Addis Ababa. Similarly, data from blood donors from the majority of transfusion centres in the country indicate a decrease in prevalence. However, further studies will be required to establish the validity of these findings. Currently available data are not adequate to accurately measure the level of infection in rural areas where 85% of the population live. Outside of Addis Ababa, in places where ANC-based sentinel surveillance are operational, the systems are not fully supported by quality control. Thus, there are concerns regarding the validity of reported results. The impact of HIV/AIDS epidemic in Ethiopia needs to be further quantified both in its burden of diseases and its impact on the urban and rural economy and society. It is, therefore, important that effort and adequate resources are put into strengthening surveillance systems.