The basic mathematical foundation for the vertical electrical soundingrnmethod has been presented by deriving the formula for the potential distribution atrnthe surface of a horizontally stratified earth. The apparent resistivity and itsrnrelation with resistivity transform function has been shown particularly forrn. Sclumberger Configuration. The theoretical background for resistivity inversionrnwith the ridge regression technique has been explained following the method ofrnInman.rnOn the basis of the above theoretical consideration the electrical resistivityrnmethod has been applied for ~ound water expluratinn and possible site forrnborehole location in South Western Butajira Area, Southern Ethiopia. To do thisrnsurvey along three profile lines were taken with a total of 20 YES points out ofrnwhich 15 were analyzed in detail.