The study was conducted at Upper Bilate River Catchment 230km, South West of AddisrnAbaba and East of Hossana to characterize aquifer and assess hydrogeological system ofrnUpper Bilate catchment by giving particular emphasis to groundwater potentialrninvestigation, mechanism of recharge and groundwater surface water interaction, in anrnintegrated manner. Data has been collected from the respective institutes andrnorganizations and processed using hydrogeological and GIS and remote sensing software.rnIntegrated approaches of hydrogeological investigations are adopted by paying particularrnattention to geology, recharge estimation, hydrogeological system and hydrogeochemistryrnin the assessment of water resources potential of the catchment. Areal depth ofrnprecipitation of the area was estimated by categorizing the area in to unimodal andrnbimodal zones. Potential evapotranspiration (PET) of the area and the water body wasrnestimated using Thornthwaite Mather and Penman Combination methods and PanrnEvaporation method respectively. Actual Evapotranspiration (AET) was estimated usingrnTurc and Soil moisture balance methods. Base flow separation and conventional waterrnbalance approaches were used to estimate recharge. To characterize the aquifer system ofrnthe area pumping test data, well completion reports, well logs and geology of the arearnwere analyzed. Piper plots, Collins bar diagram and Hierarchical cluster Analysis (HCA)rnwere used to classify the water chemistry. Maps, cross-sections and well-logs are used tornshow groundwater flow system and recharge discharge conditions. The estimated values ofrnPET are 1222.93mm and 842.4mm using Penman and Thorhthwaite method respectively.rnThe results indicate that, the highland which is unimodal rainfall pattern zone receivesrnmore precipitation (1284.65mm) than the lowland (1216.6mm). Pan Evaporation methodrnresulted about 2.57mm for the open water evaporation which was insignificant asrncompared to the area. AET was estimated to be 800.92mm and 1019.8mm using Turc andrnSoil moisture balance methods respectively. The estimated recharges of the area are 129rnand 96.18mm using base flow separation and water balance approaches respectively. Thernaverage of the two values is taken as the annual recharge of the area which is 9.2% of therntotal precipitation. The pumping test analysis results indicate that the hydraulicrnconductivity of the area ranges from 0.17 â€“ 8.8 m/d and the mean and median were 2.17rnm/d and 1.12 m/d respectively. There was variation in water type from Low TDS Na-Ca-rnHCO3 to high TDS and EC Na-HCO3 water types. Accordingly, the western and northernrnpart of the area is recharging zone and the central and southern part is discharge zonernwhile the area just southeast of Boyo plain is categorized under deep groundwater zonerndue to the damming effect of Ambericho fault. Thus, detailed hydrogeological especiallyrnremote sensing and geophysical investigation should be conducted to delineate majorrnwater bearing zones, aquifer thickness and aquifer depth in the volcanic and alluvialrnformation particularly in the northern part of the study area.rnKey words: Upper Bilate, western escarpment, recharge estimation, aquifer characterization,rnhydrochemistry, recharge/discharge zone.