Land degradation, caused by soil erosion and LULC changes, initiated by poor utilizationrnof land resource beyond the carrying capacity to provide food and other related use hasrnan effect on socio-economic status of the northeast of Alaba. Agriculture is the solerneconomy sector for people living in the region. The study guided with the main objectivesrnof assessing the extent of land degradation and its socio-economic impact of the region. Itrnalso aimed to analyze socio-economic pattern, spatial and temporal variation of soilrnerosion and LULC of the region. Necessary data were collected through field observationrnand socio-economic survey. Landsat satellite imageries analyses of three periods (1973,rn1986 and 2005) for LULC change detection, soil loss and socio-economic analysis werernused. The result for LULC change detection depicted that major reduction in forestlandrnwas 42.98% during the period of 1973 to 1986. Increment observed in crop-land wasrn11.05% during the same period. The same phenomena observed during the period 1986rnto 2005, when forest was reduced by 87.43% and crop-land was increased by 52.96%.rnThis change brought a change in soil loss (land degradation) variation across the zonesrnand at large to the whole study area between the period of 1986 to 2005. Accordingly thernlargest soil loss rate change exhibited in the zone two, which reached to 15.79% and thernleast went for zone one. In general, soil loss for the whole region changed by 35.43%rnduring this period. The soil loss variations across the zones, which actually reflect therndegradation status of the zones, influence socio-economic status of the local people.rnZones which characterized higher degradation have lower socio-economic status like therncase of zone two. To protect the land against further degradation and utilizing the landrnresource sustainably, the potential solution could be, introduce rural infrastructure forrnalternative livelihood of agrarian community and scale up the awareness of farmer aboutrnland degradation and possible management option.rnKey words: land degradation, LULC change, northeast Alaba, socio-economic status