Water is one of the limiting factors for development in the Wabi Shebelle basin area. The overallrnquantity of water available in the basin is very insufficient. In addition, the difficult access ofrnwater resources in the basin severely restricts their utilization. With an area of some 191146 km2,rnthe WSRB basin mainly comprises the south eastern highlands of the Arsi Bale. The basin isrnendowed with abundant groundwater resources that require proper management if they are to bernwisely utilized in a sustainable manner. With the Wabi Shebelle River as the major resource, thernWSRB is the most undeveloped. The groundwater potential in the basin is seldom estimated.rnThe objective of this study is to investigate the regional groundwater characteristics and to assessrnthe groundwater resource potential of Wabi Shebelle river basin. To achieve this objective, arnthree dimensional groundwater model (TAGSAC) that uses finite element method were applied.rnGround water models provide a scientific and predictive tool for determining appropriaternsolutions to water allocation, surface water â€“ ground water interaction, landscape management orrnimpact of new development scenarios. The model can also be used to simulate possible futurernchanges to hydraulic-head or groundwater-flow rates as a result of future changes in stresses onrnthe aquifer system.rnThe numerical model was calibrated by trial-and-error methods where by hydrogeologicalrnparameters like hydraulic conductivity and the recharge amount are adjusted. The relativelyrnsmall span of physically possible values of head was not considered sufficient to justify the effortrnrequired to implement inverse calibration methods. Calibration results provided the estimate onrnthe regional distribution of hydraulic conductivity values, which range from 8.64 x 10-8 m/s torn7.7 x 10-4 m/s over 36 zones resulting in a greater reliability of the spatial and temporal evolutionrnof state variables for simulations. Best model performance achieved, resulted in a mean absoluternerror of 8.77 m and a root mean square error of 15.30 m (R2 = 0.9992). From this work thernestimated replenish able groundwater potential of the study area is about (8700 MCM). Resultsrnshow that groundwater head have an immediate effect on hydraulic conductivity of the aquifer.rnAnd the amount of recharge also has its own effect on the model simulation.rnKeywords: Numerical Groundwater Flow Models; Finite Element Method, Wabi ShebellernRiver Basin, Wabi Shebelle River, TAGSAC, Ethiopia