This paper analyses growth of Industrial Manufacturi ng in Eth iopia and its contribut ion to (inprnover the past 4 and 311 Olh decades, [n general. industriali za ti on plays an il11portant ro le inrneconol11ic developl11en t. In th is regard, the rnanuJ~lcturin g sector plays the key ro le ill growthrnprocess, Despi te the il11portancc of industriali zation in Sustainable Econol11ic Growth. the sectorrnhas encountered with a serous growth problel11 that leads to insigniJi ca nt contribution to ( jUP,rndue to J'inancial constraint , shortage of supply raw materials and lack of skilled l11anpower.rnThe genera l objective of thi s study is to exal11i ne the growth of the sector and its contribution tornGOP, using Secondary data frol11 the NEE and C.S,A, which covers 43 years, The study el11ploysrnthe methodology of Johansen cointegration analys is of Economctric Time- series models, 'I (lrnidentify the effect of various factors deterl11 ining the growth of the sector, the FIML proceduresrnare el11ployed instead of OLS or 2SLS regressions, because it provides a worthwhile l11easure torngenerate more etTicient and elTective esti l11ates that explain the relationships, These techniquesrnare used to validat.e the theoreti cal assertion that th ere is one cointe g r~lting relations in th is study ,rnThe anal ys is indicates that the long-term growth rate of inVestment is posit ively relalcd lei tilL'rnweight placed on growth of the sector and is playing significant role in e-x panding its activitil's,rnWhile lhat of labor engaged in production, is the short-run effect and hence, the sector isrnch3racterized as labor intensive, In the meantil11e, the sector grol;1h is negatively inlluenced byrntota l factors of production that represent the obsolete uses technologica! IeI'd in m