To date, information regarding densities and identification of dominant coffee shade trees andrnexplanation of their interaction with physical parameters in southwestern part of Ethiopia isrnextremely very scanty. Moreover, mycorrhizal fungi spore densities, colonization rate, diversityrnand interaction with physical and chemical parameters of soil are not evaluated in any of the coffeernforest in the country and this work is to bridge such information gap. So, reconnaissance surveyrnwas conducted and the number of coffee and coffee shade tree species was counted with in a 20mrnx 20 m quadrat. Spores were separated from the bulk of the soil by the wet sieving and decantingrnmethod followed by sucrose centrifugation and counted per 100 g dry soil. Percent rootrncolonization was determined clearing the root segments in 10 % KOH and stained with 0.05 %rntrypan blue.During the reconnaissance survey extremely large number of coffee seedlings andrnsaplings were observed in the study area. Olea capensis, Schefflera abyssinica, Phoenix reclinatarnand Prunus africana were encountered as dominant shade tree species with percentage occurrencesrnof 15, 12, 11 and 10 %, respectively. Milletia ferruginea, Albizia gummifera, Cordia africana,rnCroton macrostachyus and Dracaena steudneri comprise 40 % of the total number of plantrnspecies. Twenty four percent of the dominant shade trees were principally represented byrnleguminous trees such as M. ferruginea and A. gummifera. Arbuscular mycorrhizal fungal statusrnwas also investigated. Investigation of roots and rhizosphere soils of 14 shade tree species, M.rnferruginea, S. abyssinica, C. macrostachyus, Ficus vasta, A. gummifera, O. capensis, C. africana,rnEhretia abyssinica, Pouteria adolfi-friederici, Pavetta oliveriana, Ficus sur, P. africana, P.rnreclinata and Polyscias fulva, and the coffee tree underneath revealed arbuscular mycorrhizalrncolonization and different types of AM spores. The number and morphological type of spores wererndetermined in 100g of rhizosphere soil. All species had a high level of AM colonization. F. vasta,rnC. macrostachyus, S. abyssinica and O. capensis spp. had the highest level of colonization. E.rnabyssinica, P. africana and P. fulva exhibited the lowest level of colonization. The coffee treesrnrevealed generally maximum colonization than respected shade trees. The number of sporesrnforming AM in all rhizosphere soils ranged between 578-1313 spores/ 100g of dry soil. Sporesrnwere grouped in four principal morphological types Glomus, Gigaspora, Scuttelospora andrnAcaulospora in descending order of relative abundance, respectively. Spore density andrncolonization percentage were found to be negatively correlated with O.C, total N, available P, ECrnand Zn. Population of spore types were also some how determined by soil physical and chemical properties. Arbuscular Mycorrhizal fungi are commonly considered to be non specific with respectrnto their host and their ability to colonize particular plant species. Conversely, it is investigated thatrnplant species differ in their ability to form and benefit from mycorrhizal relationship. This studyrndidnâ€™t investigate the whole range of organisms in the rhizosphere which could give benefits torntrees. So, it is difficult to draw conclusion that the well being of the shade trees and coffee plants inrnthe natural forest is due to only AMF colonization. However, AMF could be considered to be arnfuture tool in agriculture, i.e. fertilizer substitute and as biocontrol agent. So, it is recommendedrnthat: (a) studying the ecology, diversity and host range of AMF is of enormous importance beforernapplication. (b) their relation with nutrient dynamics and other soil characteristics should bernevaluated before use. (c) these organisms should receive the proper management. (d) the impact ofrnlitter fall on AMF spore density and diversity should be evaluated in the future. Finally, thisrnsymbiosis command great interest as the subject of future research with relation to food security