By any standard Ethiopia is the least developed country in the world. The feature ofrnpoverty in Ethiopia is complex and multidimensional. Almost half of its people arernliving under the absolute poverty line. In addition to income poverty, majority of thernpeople have been suffering from lack of basic social and economic services such asrneducation, health, safe drinking water, and housing. The prevalence of these aspectsrnof chronic poverty has been attributed both to manmade and natural factors;rnintermittent draught, protracted war and policy distortion of the previous regimernare often cited as the major ones. The centralized and top-down developmentrnplanning system that prevailed for years so has been condemned for its inability tornreduce poverty and bring development in the country.rnThis led Ethiopia to enact a new long-term development and poverty alleviationrnstrategy. This strategy emphasizes the adoption of a bottom-up and participatoryrndevelopment approach with the primary focus of poverty reduction and sustainedrneconomic growth to be achieved through a combination and mutually reinforcingrnprograms at various fronts. The strategy is believed to generate significant payoffsrnby removing central bottlenecks, fostering community participation and ownership,rnand improving the efficiency of development program implementations. This is thernessence and objective of community-based development (CBD). Currently, (CBD)rnstrategies are being widely applied by governmental and non-governmentalrnorganizations. These agenCies translate CBD strategies into action programsrnthrough the implementation of development projectsrnDespite vCllying arguments Oil the application of CBD, the approach is universallyrnrecognized as the best means to fight poverty in its full dimensions and to ensurernsustainable development. For this reason the Government has established anrnindependent CBD facilitating agency called the "Ethiopian Social Rehabilitationrnand Development Fund-ESRDF" to operate throughout the Country. ESRDF hasrncome through a pilot test, which was reported to be effective in promoting CBD.rnMoreover, reports show that this agency is bringing significant changes upon thernlives of poor rural communities by financing various demand driven developmentrnprojects. Such success reports can draw the attention of researchers or commentators to prove whether CBD approach is worthwhile to the developmentrnneeds and realities of Ethiopia.rnAccordingly, this research was intended to test the validity of this widely propagatedrnapproach by taking the experience of ESRDF in the Amhara Region. For thisrnpurpose, primmy and secondary data have been collected through fieldwork fromrnvarious sources. Results of obtained information have been analyzed in line withrnbasic theoretical and conceptual arguments of the subject. The points of referencesrnemployed for the assessment of the relevance of CBD approach mainly include thernproper application of popular participation and empowerment, and otherrnembodiments of these core concepts