The central problem of this study was to identify the challenges facing the teaching and learning of physical education with a view of coming up with recommendations that can positively enhance the effective teaching and learning of the subject. The objectives were to; identify the challenges related to resources in the teaching and learning of physical education, find out the attitudes of teachers and pupils towards physical education and determine teachersâ€Ÿ preparedness in handling physical education lessons. rnThis study utilized a descriptive survey design. The descriptive survey provided qualitative information from a representative sample of the sampling frame by the use of an interview guide, observation checklist and questionnaires. rnThe study was carried out in governmental preparatory schools of Addis Ababa. The targeted respondents were the; five (5) head teachers, five (5) school directors, three hundred and twenty eight (328) students. Five (5) sampled schools took part in the study. The head teacher of each sampled school was interviewed; all the twenty (20) teachers and 328 pupils from the sampled school filled a questionnaire. rnInterview schedules were used since they frequently give very high response rates. Both questionnaires and observation checklist were also used during the study. Through questionnaires, there is greater consistency therefore greater compatibility in the response. The checklist was used to ascertain the availability of the resources and the challenges therein. The research instruments were piloted in two (2) schools. Test-retest method was used to test the reliability of the questionnaire and Spearman rank order correlations were employed to compute the correlation coefficient. rnThe findings of the study indicated that the major challenge facing teaching and learning of PE was lack of enough facilities that could facilitate learning process.