The concept of local governance can have different meaning to different peoples and groups. Itrndoesn't have a universally accepted meaning. It should be understood based on the plillJoses ofrnits application. Aid donors, development agencies, international financial institutions and socialrnactivists have developed their own concept and indicators of governance. Even though there arernconceptual differences among these groups, all of them agreed up on the needfor governance tornpromote development and improve the quality of citizens well being. Good governance hasrngained significant attention in developing countries and Ethiopia is no exception. It is widelyrnrecognized that as a precondition/prerequisite for sustainable development particularly forrndeveloping countries like EthiopiarnLocal governance requires the involvement of various stakeholders living and lVorking togetherrnto achieve different objectives. Local governance is more than the provision of services by localrngovernment. It requires the interaction and cooperation among different stake holders tornpromote their rights and discharge their responsibilities.rnThis paper assesses the challenges of good governance via selecting of a case study woreda.rnHence fore, in this paper transparency and accountability, community participalion and rule ofrnlaw which are the core dimensions of good governance had selected to assess prevailingrnconditions in woreda court, municipal office and woreda administration. The main objective ofrnthe study was to assess the state of local governance in the town and describe the relatedrnpractices, challenges and opportunities. Capacity, discrimination, corruption, accessibility ofrninformation, delay, openness and satisfaction are considered the major determinants of goodrngovernance in the woreda in general and the selected public institutions in particular. To knowrn() the perception of service users on transparency, accountability, community participation andrnrule of law of the selected public institutions a descriptive study had used that enriched throughrnoral and writ/en interview, discussion, personal observation and survey. Hereafter,rnincapacitated human power had observed and identified in the selected public institutions and inrnthe town. Moreover, due to lack of capacity in the service providers disseminaling information,rnaccessibility of their institutions information, delivering a timely service aud providing decisionrnbased on reasonable evidence had rarely practiced.