Soil erosion is the deterioration of soil by the physical movement of soil particles from a givenrnsite and a cause for land degradation. The study carried out an assessment of the extent of soilrnerosion in Holeta watershed by delineating the micro watersheds and studying the perception ofrnthe farmers on the impact of soil erosion on their socio-economic conditions. In order to achievernan over view on the erosion status of the study area and to identify potential areas whererneffective erosion protection measures might be useful, erosion risk assessment was carried outrnusing farmersâ€™ perception, earth fill dams and RUSLE Model analysis. The multinomial logitrnmodel was used to study the identification of major socioeconomic and physical factorsrninfluencing soil erosion. The farmers perceive soil erosion and land degradation mainly by yieldrnvariability, change in soil color and appearance, occurrence of stony and pebbles followed byrnrill, sheet and gullies formation. To estimate a spatially explicit soil erosion risk in the studyrnarea, Digital Elevation Model (DEM) and Landsat TM image were used with the RUSLE model.rnThe results of the study revealed that the total amount of potential soil loss in the HoletarnWatershed is about 16,417.30 tons per year. The erosion risk map of the studied watershedrnrevealed that 20.3 % of the area has low erosion risk status,55.9 % of area moderate and 23.8%rnof the area high erosion risk status. The problem of environmental deterioration will become onernof the most serious problems in future. Based on the study results it was recommended that thernmicro/sub-watersheds having large rate of erosion should be given first priority during thernintroduction of intensive and well designed integrated watershed management interventions inrnthe study area.rnKeywords: Soil Erosion risk; Farmersâ€™ Perception; Earth fill dam, RUSLE; Holeta watershed,