Among the foremost important and crucial decisions for any business is about capital structure since it has significantrninfluence on financial performance of a company. The objective of this paper was to analyze the effects of capitalrnstructure on the financial performance of selected Ethiopian Commercial banks. To achieve the research objectives,rnthe researcher would use a panel data analysis, and has adopted a purposive/judgmental sampling approach. Duringrnthis study, the researcher would use only secondary data and document review for collecting data from annual reportsrnof five (5) selected Commercial banks over the past ten (10) years period from 2010 to 2019. Besides that, the datarnwas analyzed by using a multiple regression model on a quantitative approach. The study has used return on assetsrn(ROA) which is one of an accounting-based measure of financial performance as a dependent variable, and other fiverncapital structure measures, these are; total debt ratio (TDR)), loan to deposit ratio (LDPR), and deposit to asset ratiorn(DPA) are as independent variables, and bankâ€™s size, and growth as control variables were used. Random effectrnestimation model was applied for the panel data analysis through EViews 10(64x) statistical package. The resultrnindicates that capital structure as measured by total debt to total asset indicates that it had a positive relationshiprnwith profitability measured by ROA and statistically significant at 5% level. Theoretically it was supported by tradeoffrntheory. Besides, loan to deposit ratio had positive relationship with profitability (ROA) and statistically notrnsignificant at even 10% significant level. It was also supported by trade-off theory. To the contrary, deposit to assetrnhad negative relationship with profitability of banks with strongly statistically significant at 1% level measured byrnROA. Theoretically it was supported by pecking order theory. On the control variables, growth and asset size had arnnegative relationship with profitability, and statistically significant. The result shows that the Ethiopian Commercialrnbanks have confidence on total debt financing which maximizes banks profitability, and such banks instead of otherrnsources should keep their financing focus to deposits. The result of growth and size in this study call for Commercialrnbanks and higher-level managers to give attention and be efficient to maximize profitability of bank because the causernis related to efficiency of both the management and managers.