Service quality is a comparison of expectations with performance. This aim may be achieved byrnunderstanding and improving operational processes; identifying problems quickly andrnsystematically; establishing valid and reliable service performance measures and measuringrncustomer satisfaction and other performance outcomes. This study intended to address perceivedrnlevel of quality of the service provided to customers in Gandhi, Addis Ababa. The objective ofrnthis research was to identify the factors affecting service quality in the hospital context in orderrnto recommend possible actions to be taken by the hospital management. The sample this studyrnwas 384. A total of 384 questionnaires were distributed during this period. The questionnairernwas developed in English and translated into Amharic (the local language) and back translatedrninto English to ensure its consistency. To assess the service quality in health care, respondentsrnwere requested on tangibility and other four factors. The result indicated that this factorrn(tangibility) did not have a correlation with perceived performance of the hospital withrninsignificant impact on performance. Reliability, responsiveness, assurance and empathy asrnservice quality were corrected to performance and had significant impost on performance. It wasrnunderstood that the hospital had a weakness on providing physical facilities, equipment, andrnappearance of personnel of an organization. The limitation of the hospital was observed onrntechnical service facilities and made it visually not appealing. It did not have more modernrnequipment and materials associated with the service that were not visually appealing. Thernhospital should exert its efforts on improving the tangibility (physical facilities, equipment, andrnappearance of personnel of an organization) by improving the hospital service facilities to bernvisually net appealing of the hospital