This study was designed to examine the perception of teachers towards the purpose, criteria,rnprocess and the problems of perfonnance appraisal of teachers encountered in secondaryrnschools of Addis Ababa. To this end the major aim is to identify the weaknesses and come uprnwith recommendations.rnA total of 225 teachers drawn from 12 senior secondary schools were used as data sources.rnThe data were gathered by means of questionnaire and interview. Results were analyzed usingrnpercentage, means, chi-square test and t-test.rnThe major findings of the study included that quite majority of the respondents support thernperfonnance appraisal scheme, but significant number of the respondents are dissatisfied withrnthe implementation. And almost all respondents indicated that parents and students are notrnappropriate to appraise teachers. The lack of appropriate skill and experience, contribute tornthe limitations. Besides, teachers have not recognized the various purposes of perfonnancernappraisal and many of them are not applied. The criteria used by appraisers (students, parents)rnare not known. Teachers do not know the criteria they are evaluated with. There is norntransparency in appraising teachers. The result of the perfonnance appraisal is kept secret. I trnis not communicated to teachers.rnProblems encountered in the implementation of performance appraisal scheme for teachersrnwere identified. The objectives that teachers are expected to achieve are unclear, poorrnoperation of the scheme, lack of skills and competence of appraisers and irrelevant criteria.rnHence according to the findings of the study, it was recommended that the necessary stepsrnshould be taken by the concerned authority at all level in order to revitalize the currentrnpractice of the perfonnance appraisal of secondary school teachers. To this effect, irrelevantrncriteria should be avoided. Criteria should also be flexible and situational. Furthennore,rnappraisal system should be an integral part of staff development work in schools, it should bernboth positive and constructive. In this regard the fonnative evaluation should be wellrnstrengthened and systematica lly applied in schools. In addition to this, peer observation andrnschool in-built supervision need to be inrroduced so that teachers deve lop their professionalrnskills providing feedback to each other and assist them in improving pupils' performance.rnEven though, most of the potential errors in appraisals that distort evaluation can bernminimized through training; the impact and the consequence of involving parents and studentsrnin the appraisal system need in-depth study.