Wonji basin covers a total area of 357 Km2 and has a population of 290,703 out ofrnwhich 50,000 are sugar estate farm workers. The main source of domestic water in thernarea is groundwater. Awash river passes in the area dividing in to two equal partsrnwhose water is mainly used for cattle drinking and industrial purposes. Meteorologicalrnand hydrological data were used to establish and calculate water balance in the Wonjirnbasin. Groundwater recharge was estimated to be 557.75 x 106m3 per year. Differentrnmethods some with many parameters and others with few were checked side by side tornobtain more realistic actual evapotranspiration. Their average gave 702 mm meanrnannual actual evapotranspiratin. The mean annual rainfall is 785 mm in the area.rnBased on joint data along with mathematical treatment and pumping test results,rnlithological units have been characterised into different permeability groups. From thernresults of water chemistlY and compositional diagrams, 5 groundwater systems withrnsome interconnections were identified. Direction of regional groundwater flow of thernbasin is from west to east. Two horizons of cold water of deep aquifers occur at anrnaverage depth of 120 and 170 in the region. Using temperature of thermal springs,rndepth of geothermal water circulation has been calculated to be 242 m below thernsurface. This has been also confirmed by the drilling data of borehole 26. However thisrndepth could vary up to 400-500 III under Gadamsa caldera rim, Boku ridge and Kokarnescarpment high lands. The estimated groundwater demand in the basin ranges up torn4.7xI06m3rn, which is Illuch less than yearly recharge.rnFluoride concentration showed zonal variability from low lying parts of the basin to thernhigh lands of the study area corresponding to compositional variation of the rocks andrnthermal activity. Concentration of total dissolved solids in the groundwater, exhibitedrnpositive relation with irrigated sugar plantation. Pollution from inorganic fertiliserrn(NO,) is not however, observed under sugar cane farm. This is suggested to be due tornhigh groundwater inflow dilution from Koka reservoir. Subsurface water in the regionrnis generally of good quality for drinking purposes. But some dug wells and hot springsrnare of non promising quality for irrigation.