The purpose of this study was to assess the implementation of block grant utilization in governmentrnschools in Oromia. Basic issues attempted to address are stated as: How does the block grant beingrnimplemented in government schools? To what extent do school leadership (PTSAs) are involved inrndecision making on the allocated budget utilization? What are the major challenges that affect thernutilization of block grant budget? The study employed a survey method using data gathering toolsrnquestionnaire, interview and document analysis. Sampling techniques used were cluster sampling andrnmulti-stage random sampling technique. The study was conducted in 32 primary & 8 secondary schoolsrnthat were drawn from a total of 360 schools in sampled woredas. For this study, questionnaire was usedrnas the instrument of data collection from teachers, school principals and PTSA members. The datarnobtained from questionnaires were analyzed using quantitative statistical tools such as frequency count,rnpercentage and mean value. The finding of the study point out that amount of allocated budget tornimplement education plan and in meeting the minimum requirement of standard was found inadequate,rnrecently 7.6% & 36.8% woredas didn’t allocate even a minimum rate for secondary & primary schoolsrnrespectively. Whereas schools have sources of budget other than government allocated budget to fill theirrngaps. The finding of the study revealed how the level of transparency and accountability in budgetrnprocesses, utilization of finance and material resource gained from block grant were problematic forrnM&E system is loose. Schools’ PTSA are not empowered to decide on block grant budget utilization.rnDelay of budget or goods dispatch, lack of printed block grant guideline (Blue Book), lack of training onrnfinancial management & formats/vouchers, lack of internal audit and control, were among problemsrnindicated. In light of the findings, the following conclusions were drawn. Block grant guide line seemedrnnot well communicated. PTSAs by large were not exercising their leadership role in managing blockrngrant fund because they were snatched by Woreda/Town level finance and/or education offices. Manyrngovernment schools have no relevant human resources, also did not provided and enable to use necessaryrnformats so as to carryout safe and legal financial accounting and property management as intended.rnGovernment financial transparence is under question because WOFEC and schools were made nothing tornpublically announce the BG budget allocated for government schools. Standard unit cost per student inrnthe ‘Blue Book’ was not maintained and students’ enrollment was not considered, schools have norndedicated bank account for block grant to manage its cash flow, in most cases grant disbursementrnmodality is in kind rather than in cash, above all block grant budget allocation and unit rate didn’trnconsider the current market price. Therefore, in order to maximize grant utilization and to alleviaternchallenges encountered, the study forwarded the following recommendations. For immediate remedialrnactions to be done included. Improving the capacity and management skills of school management,rnfinancial personnel and staff on management and use of their non- salary recurrent budget. Besides, arnlong-lasting and workable education act should be deployed both at national and sub-national (regionalrncouncil) level. Finally, the researcher would like to recommend that further researches needed to bernconducted on the block grant utilization in government primary and secondary schools from differentrnangles.rnKey words:rnBlock grant, General Education, Government schools, Fiscal year, Recurrent expenditure, Capitalrnexpenditure, Learning environment and Education Act