Background
Monotonous low quality diets are the norm in resource-limited environments across the globe. Dietary diversity is a challenge for rural communities in developing countries. Their diets are based on starchy staples with inadequate animal products, fresh fruits and vegetables.

Methods
A community based cross sectional study was conducted from August 22–30, 2015 at Finote Selam Town. Systematic random sampling technique was used to select 400 households. Data were collected using pretested and semi-structured questionnaire. Both bivariate and multivariate logistic regression analyses were carried out to identify factors associated with household dietary diversity.

Results
The prevalence of low, medium and high dietary diversity scores were 11.8, 67.2 and 21% respectively. Family head (Men headed) [AOR = 4.75 (2.22, 10.16)], frequency of eating [AOR = 6.06 (2.82, 13.06)] and shortage of water for cooking [AOR = 5.69 (1.39, 23.27)] were significantly associated with household dietary diversity.

Conclusions
In this study the prevalence of adequate household diversity was 88.2%. Family head, frequency of eating and shortage of water for cooking were significant factors for household dietary diversity. Empowering women, increasing frequency of eating among family members and avoiding shortage of water for cooking were recommended to sustain and improve household dietary diversity.