Level of motorization and travel demand in Bahirdar city is increasing rapidly with its population. Providing effective parking areas for the vehicles is a fundamental part of transportation. The road facilities in Bahirdar city serves for movement of the vehicles as well as parking them. These types of facilities were found to decrease the capacity and mobility of the road and incurred traffic congestion. On-street parking activities such as parking maneuver and double parking were found to decrease the available road width for traffic flow. In order to overcome this problem better traffic management based on studies plays a major role in providing an efficient transportation system. This study took a major road segment with considerable traffic and parking activities to study the level of parking demand and supply. Furthermore to capture the impact of onstreet parking on traffic flow, field measurements of traffic flow, average travel speed and others were taken. The local driver’s behavior of parking consumption length and parking maneuvering time were found by using empirical analysis. In order to study the impact of on-street parking on traffic flow a macroscopic traffic flow modeling, statistical regression analysis, and HCM manual was adopted. Results revealed that the availability of on-street parking affects the traffic flow significantly. The capacity of the road was found to reduce by 24% due to legal parking activities and an additional 25.9% reduction due to illegal double parking activities. Moreover, for each parking occupancy increment the average travel speed was found to reduce by 0.032km/hr. Generally, if on-street parking is removed from the study sites, the capacity could be improved by 49.9% and the travel time could be reduced by 36%. The parking demand and supply study shows a significant scarcity of parking lots in the study location which makes the impact worse. The current level of service of the study urban street was found to be LOS-C, which is a good condition for now but it could create a lower performance for the current traffic growth trend in the future. The possible parking management strategies recommended in this study are designing off-street parking lots, designation of parking areas to increase the capacity and using dead roads for short-term parking supplies.