The process of duplicating an existing part, subassembly, or product without drawings,rndocumentation, or a computer model is known as reverse engineering. Reverse engineering isrnnon-market channel of technology transfer. Through this, technology adaptation, adoption andrncapability can be built. Currently, the government of Ethiopia is working on import substitutionrnand tries to minimize the spare parts, equipment and machineries requirement of the leather,rntextile, food processing, construction, sugar and cement processing industries by a substantialrnpercentage. The main emphasis is due given for the success of reverse engineering. Moreover,rnmetal and engineering sector is a leading economy of the sector.rnThis research focuses on reverse engineering and technology transfer in metal and engineeringrnsectors of Ethiopia. The objectives of the research is to identify the status of reverse engineeringrnin the country, the efforts of local research and development, government policies on reversernengineering and propose a means to strengthen reverse engineering and technology transfer inrnthe country.rnUsing firm level survey together with the secondary data’s obtained from different research andrnothers work, the reverse engineering and technology transfer is assessed. Accordingly, thernawareness level of the firms and the undertakings of reverse engineering are significant. Thernavailable markets, technical capability and demands for adapted products using reversernengineering are also encouraging for most sectors due to the shortage of foreign currency in therncountry. Moreover, the research identified the major constraints of the firms not to develop thernreverse engineering practice and transfer technology such as low government support whichrnaccounts 63.6% of the respondent and lack of research and development at the firm level whichrnaccounts to 81.8% of the surveyed company.rnThe study has developed a model and proposed a solution for the successful implementation ofrnreverse engineering and for developing research and development at the firm level.