It is a common proposition that social capital unquestionably results in progressiverncommunity development. Such a proposition or social capital theory in general suggestsrnabout the existence of social capital in any kind of community in general, be it ofrnpolitical, religious, ethnic, geographic, and so on. However, more specifically, the ethnicrnsocial capital perspective obtained from the study among the Wolaytta would proposernthat social capital interweaved in ethnic identity is a stronger one in maintaining thernethnic unity as well as in promoting community development, particularly for suchrnspecific community. The study among the Wolaytta of southwest Ethiopia, throughrnqualitative data collection of interviews, focus group discussions and observations withrnvarious community members shows that there are several elements of social capital,rnespecially bonding social capital, which have direct contribution to communityrndevelopment, despite the discovery of some of them which can also hamper desiredrndevelopment. The findings were analyzed through grounded theory method. SincernEthiopia is home for several ethnic communities, their socio cultural resources withrnstrong implication for community development can be utilized. The finding of socialrncapital from this community can fit to the contexts of other ethnic communities inrnEthiopia