Extreme poverty and youth unemployment have been critical problems and concern for developingrncountries. Cognizant (j/ this, Technical and Vocational Education and Training (TVET) institutesrnare particularly viewed as major instruments to attain the desired development and employment. Inrnthis regard, Micro and Small Enterprise (MSE.I) are the main income generating activities of youthrnoperating enterprises in Ethiopian cities and towns thereby contribute to unemployment reductionrnand poverty alleviation. Overall. allention needs to be given to the neglected area, especially, suchrnas the role orthese MSEs ' in slIslCiinable employment creation./or youth TVET graduates.rnThe objective of the research was to identifY the role of MSE in reducing youth unemployment orrncreating employment opportunities for rVEr graduates in Addis Ababa City Administration,rnspeci/ically in the Cooperatives Induslry Areas (CIAs) and to provide possible solutions. rhernSimilarity o/training and current job orMSE operators, the factors of self-employment, the causesrnof unemployment. the assessment 0/ underemployment, the contributions 0/ the MSE sector, thernprovision 0/ credit services. and the stanis o/BDSfacilitation were the major themes of the study. Inrnorder to gather relevant in/ormation/i'om MSEfacilitators and rVEr graduates, descriptive surveyrnmethod was employed. Moreover, jive Cooperative Industry Areas (CIAs) was included in the studyrnthat had highly concentration of both types o/formal and non-formal rVEr graduates who arernoperators o/MSEs in Addis Ababa CIAs. The selections (j/those CIAs were based on 'one CIAji-omrnone Sub city ' basis using purposive sampling technique. Since both types of rVEr graduates arernhighly concentrated in those jive sub cities. 52 formal rVEr graduates, 30 non-formal rVETrngraduates and 20 MSE/ aeili'ators (/iJllr Regional MSE faCilitators, eight Sub city MSEfacilitators,rneight Kebele MSE officer.l) were taken using availability sampling technique.rnBased on Ihe basic questions or Ihe study, the coliected data through two main groups ofrnquestionnaires were analvzed Finally, summw)' of major jindings, concluding remarks andrnrecommendations have been made based on the major themes of the research. The research resultsrnrevealed that the majority or the TVET graduates' present job was completely di./Jerent /ronl theirrntraining area. In addition. among them the majorilies were not self-employed ajier graduation andrndidn't obtain wage employment alier graduatiOn. Moreover, the current production capacity (j/rntheir enterprises ' was/ound being under production capacity and most of the rVEr graduates arerncurrently looking .lor other jobs. Consequently, most of the TVET graduates joined in to the MSErnbusiness because 'hey could not have any other options. Above all their production was in problemrndue to lack of loan. Currently, they need assistance or BDS and market place .lor their products.rnOverall, the sustainability 0/ employmel1l 0/ those yauth rVET graduates was critical. There./ore,rnthefol/owing recommendations are drawn: (I) faCilitate advanced short and long term trainingforrnthose misplaced graduotes Ihrough on- the~job training (the training, the trainer and the trainee inrnthe workplace): (2) iv/icro Finance Institutions (MFh), rVEr institution offiCials and MSErnjilcilitators should recogniZl! and make a conducive environment by considering the majorrndeterminanl/ilctors o(sel/:emploYlllent'/or youth TVET graduates a/ier graduation; (3) to minimizernunemployment afier graduation, tminees should be involved in part-time work at least in voluntwTrnservice term while they were allending their training in line with the apprenticeship program; (4)rnthe f ederal government should also intervene more on the expansion of CIAs for sustainablerneconomic basement as well as business incubators should be expanded in evel), sub city level; (5)rnregional MSE and!vlFl oUicials wi,h col/ahoration of TVET institutions should apen branch onlcesrnin evel), TVET centers; (6) MFfs l1Iith col/aboration of government Banks and Private Banks shouldrncreale reasonable rate 0/ loan interest ./01' !viSE operators in the CIA .1'; and (7) in order ta providernBDS faci lity, other thlln gOl'ernl71el7l. non-governmental and private organizations shouldrnparticipate lhrough in :tee IlCr se/'lliec 'procedure.