The purpose of this study was to scrutinize the practice and challenges of distributed leadershiprnin Addis Ababa University. In order to meet the objectives of the study, descriptive surveyrnmethod was employed. From 248,instructors, 78 instructors from 6 colleges, 3 deans fromrnCollege of Social Science (CSS); College of Business and Economics CBE); Colleges of NaturalrnScience (CNS); College of Development and Environmental Studies (CDS), College of Educationrnand Behavioral Studies (CEBS) and College of Law and Governance Studies were selected forrnthe study. Instructors were selected by Simple random sampling technique. Available samplingrntechnique was used to select college deans. Questionnaire containing open and close-endedrnitems, and semi structured interview, rating order and items constructed in terms of Likert scalernwere employed in the process of data gathering. The data obtained through the questionnairesrnwere analyzed using frequency, percentages, mean, standard deviations, and rank order. Therninformation obtained through open-ended questionnaires and the interviews were organized tornsupplement the quantitative data. Findings from the data analysis revealed that most instructorsrnin AAU moderately perceived the features of distributed leadership. It was also noted that thernleadership structure of the university moderately entertain the practice of distributionrnleadership. Furthermore, the study revealed that instructors participation in decision-makingrnresponsibilities beyond their own classroom and department functions and their collaboration tornachieve the collective ambition of the university were undersized. Lack of team work, loose tiernamong college deans, department heads and instructors and lack of shared responsibility amongrninstructors were the major challenges that deter the practice of distributed leadership practice inrnAAU. On the other hand, the study showed that ensuring well- built relation amongst collegerndeans department heads and instructors, persuade team work and shared responsibility, creatingrnfavorable condition to facilitate team leadership and collective responsibility, ensuring smoothrncollegial relationship amongst instructors were the major solutions to the problems. Collegerndeans and department head work hand in hand to strengthen as well as guarantee thernparticipation of instructors in the decision making process of their respective college, ensuring,rnteam work, strong relationship, shared responsibility and creating favorable conditions forrneffective practices of distributed leadership in the university were the major recommendationsrnforwarded in the study.