Background: Anemia is the most common blood disorder and common complications ofrnDiabetes mellitus. It is also a global public health problem affecting both developing andrndeveloped countries with major consequences for human health, social and economicrndevelopment. In Ethiopia, chronic illnesses are tremendously rising with their complications, butrnvery little research has been conducted, particularly on anemia among type two diabetic Mellitusrnpatients. Therefore, this study aimed at assessing the prevalence of anemia and associated factorsrnamong type 2 Adult diabetic mellitus patients attending Ambo town government hospitals inrnwest shewa, Ethiopia.rnMethod: A Hospital-based cross-sectional study was conducted on type two Adult diabeticrnMellitus patients for a routine checkup from September - October 2020 at Ambo townrngovernment hospitals by using a simple random sampling technique. Data were collected byrnface-to-face interviews, administered questionnaires, and other biological samples such as bloodrnand urine from 356 patients. Data was entered to EPI-info and exported to the SPSS softwarernpackage for further analysis, bivariate and multivariate logistic regression models were fitted;rncrude odds ratio and adjusted odds ratio with 95% confidence interval were computed. In allrncases, P-value less than 0.05 is taken as statistically significant. rnResults: The study showed that 27.5 % of participants were anemic. Out of anemic type tworndiabetic Mellitus patients, 92 (92.9%) and 7 (7.1%) had mild and moderate anemia, respectively.rnHaving nephropathy (AOR = 6.2, CI: 1.82, 21.16), being male (AOR = 4.32, CI: 1.09, 517.03),rnduration of diabetes for 5 years and greater (AOR = 4.42, CI: 1.27, 15.45) and having high serumrncreatinine (AOR=10.07, CI: 2.89, 35.2) were all significantly associated with anemia. rnConclusion and Recommendation: The magnitude of anemia was 27.5% among type tworndiabetic Mellitus patients in the study area. Therefore, routine screening of anemia for all typerntwo diabetic Mellitus patients aiding in early identification and improved management ofrndiabetes will lead to improved quality of life in this patient population.