Climate change is one of the vital issues which pose unprecedented cha llenges mankind is fac ingrnnowadays. The im pact of climate change is seen throughout Ethiopia but the degree varies fromrnregion to region. The pastorali st areas are the most vu lnerable place that the impact of changeattributedrnproblems is felt great ly. The objective of this research is to assess the effect of cl imaternchange on the pastoralist livelihood system and exam ine li velihood di versifi cation as a copingrnstrategy for pastora list communities in Liban zone of Ethiopian Somali regional state.rnThe data of the research was collected from the field by using both qual itative and quantitativerntechniques. The qualitative techniques employed are PRA tools such as key informan trninterviews, focus group di scuss ions and fi eld observat ions whi le the qu ant itat ive tool used wasrnhousehold survey from 85 pastoral households from four sub-di stri cts selected by employingrnappropri ate sampling procedure proportionatel y. Besides, relevant secondary data from books,rnjournals, scholar papers, and government and non government publications have been used tornsupplement th e prim ary data. Then, the data was managed by using descriptive stati stics.rnFrequencies, mean and cross tabu lat ion were the methods that has been employed for the datarnanalysis and presented in a form of graph s, tab les and charts.rnThe find ings of the research indicate that frequent droughts, low rai nfa ll , increasing temperature,rnflood s, li vestock di sease as the main climate change-related problems experi enced by thernpastora li st household s. The study ident ifi ed that there was li vestock holding reduction due to thernrecurrent droughts, li vestock di seases and high off-take in the area. It also shows that the mostrnvulnerab le segments of the community are children, women, elders and di sab led people. Fu rther,rnthe results show that pastorali st communities use wide range of local strategies to cope withrnclimate change. Rain-fed crop cu ltivation is pract iced as a complementary strategy though it isrnnot viable due to the low rain fa ll in the area. The results also indicate th at livelihoodrndiversification of both natural and non-natural li ve lihood act ivities are practiced in whi ch thernnon-natural is promising in enhancing the adaptive capacit ies of the pastora li st communities.rnFinall y, the study found out that the in stitut ional responses are ori ented towards emergencyrnassistance throu gh asset protection schemes. The study recommends that future interventionrnneeds to consider the new emerging trends as new pathways and treat pastoral development asrnintegral part of urban development rather than pure rural deve lopment in order to increase thernada pti ve capacity of the pastoral community th rough long-term li ve lihood diversifi cationrnprograms in th e area.rnKeywords: Climate Change, Livelihood Diversification, Adaptive Capacity