EIA is one of the means that decision-makers use to consider the impact of their actions on the environment. As a tool for decision-making, EIA emerged in 1969 in the US and it has now obtained a wide acceptance around the world. Accordingly, most countries have provided for some form of EIA to ensure environmental protection. In Ethiopia, although the relevance of EIA in decision-making was recognized in 1997 by the EPE, it was firmly established in our legal system in 2002 with the enactment of the EIA Proclamation. Ethiopia has recognized the system of EIA because in addition to contributing to environmental protection it facilitates sustainable development, fosters the implementation of the right to clean and healthy environment, brings about administrative transparency and accountability, and facilitates public participation in decision-making process. Hence, decision-makers in Ethiopia are expected to use EIA to consider the impacts of their actions on the environment. In this paper, I have examined whether the system of EIA in Ethiopia is adequate both in law and in practice. Accordingly, I have argued that the system of EIA in Ethiopia is not adequate both in law and in practice to ensure the achievement of the objectives for which EIA was recognized because, inter alia, (1) the laws relating to the use of EIA are inadequate, (2) the institutions that are established to ensure the effectiveness of the system of EIA are facing various problems, (3) EIA is often not used to make decisions, (4) most licensing bodies do not use ECC as a condition to issue licenses, (5) the consequences the existing laws attach to failure to comply with the legal requirement of EIA are not applied, and (6) environmental protection agencies do not carry out pre- and post EIA evaluation monitoring. Equally, I have argued that there are opportunities that, if used, can lead to improved effectiveness of the system of EIA in Ethiopia. These opportunities include attitudinal change towards the relevance of EIA, the use of EIA as a condition to grant loans, and the recognition of environmental protection in Ethiopia's strategic plans.