Electoral system design is being recognized as one of the key instruments in democracy inrnchanging votes into seats. In Ethiopia since 1991 various elections have been held, and thernelectoral system in use is the plurality electoral system. The plurality electoral system is a systemrnwhereby, a party or a candidate who garnered most of the votes in a constituency is declared as arnwinner. It distorts the allocation of seats when changing votes into seats, and benefits the biggerrnparties. The system has the potential danger to produce a minority government as a result ofrnâ€˜manufactured majorityâ€™ in the legislature, which can generally spell civil strife than democracy.rnFurthermore, it influences the behaviors of parties negatively in view of the culture ofrncompromise and tolerance, and it is not as inclusive as much as possible to be recommended forrnsuch highly diversified and emerging democracy. This paper sets out to show the types of variousrnelectoral systems and their consequences. Ethiopia with its federal arrangement and inrnconjunction with its parliamentary system needs an electoral system that allows morerninclusiveness than exclusion, a stable government that sustains credibility and legitimacy, than arngovernment which looses credibility and legitimacy shortly, an electoral system that facilitatesrnfor compromises and tolerance than that widens the polarization of the political parties. To fosterrnthe democratization process and to redeem from the past backward political culture for a betterrnfuture this paper argues for the re-thinking and redesign of the electoral system by substantiatingrnwith various evidences