Policy has long been considered as one of the major driving forces for land use change and agricultural development. However, a designated and in-depth study on its interaction with land use change and agricultural development is still very limited. The authors, therefore, attempted to address this issue by using five villages representing three agro-ecologies (highland, midland and lowland) for the period
between 1965 and 2007. The study indicated that land policies of the imperial and communist regimes contributed largely to the increase of arable land while a decrease in vegetated land. This is, however, reversed in the EPRDF regime. Land productivity/crop harvest (t/ha) and herd size per household have declined. Agricultural policies played active roles in the change of water area and indirectly contributed to the change of construction land.