Ethiopia has been under-taking different urban land policies to address land related problems;rnand supply urban infrastructure and social services since 1975. Urban land lease policy wasrnfirst introduced in 1993; and then amended in 2002 due to its inefficiencies to achieve itsrnobjectives. The government amended the existing urban land lease policy and introduced it inrn20 11. This action created debates among different sections of the communities. The centralrnaim of this paper is to analyze the public reaction to this newly introduced urban land leasernpolicy and its possible future implications. This study tries to identify the reason behindrnintroduction of the policy; examine the public reaction to the policy and its poss ible futurernimplications; and look at the level of the stakeholders' involvement in the policy processes.rnMixed research methods; community cross sectional research design; primary and secondaryrndata sources; household survey, focus group discuss ions and key infonnants' interviews werernused for this study. The results of the study indicated that: this lease policy was designed tornmeet the ever increasing demand for urban land through proper urban land management; thernpolicy process lacked stakeholders' involvement and public voices; regularization of illegallyrnoccupied urban land disappointed the majority; the conversion of old possession to leaseholdrnaffected the possessors and the banks. FUlthermore, the concepts in the new regulationrnprepared for implementation of the new proclamation has contradict with that of thernproclamation; and research participants doubted on the role of this policy to solve the defectsrnof its predecessor's policies: and achieve its pre-set objectives as well