Abstract Internal displacement as a national crisis in Ethiopia has been increased since recently. It was engendered by intense interethnic conflicts in various parts of the country. Thus, as a solutions initiated by the Ethiopian government, IDPs locally integrated in Sekela Woreda. Although complex to implement, local integration has been supported by international, governmental and nongovernmental organizations. Hence, the main intention of this study was to assess forced internally displaced persons in Ethiopia focusing on the challenges and prospects of local integration in Sekela woreda. To achieve the main objective, this study employed a qualitative case study and the data were collected from both the primary and secondary sources. Interviews and FGDs were used as a data collection instrument to collect primary data while the secondary data collected from various documents. Both snowball and purposive sampling techniques were employed to select key informants and FGD participants. The thematic analysis was used to analyze the data collected primary and secondary sources. Accordingly, the findings of the study unveiled that ethnic regionalization as ideological tool for divide and rule, legal paradox in constitutionally recognized rights, the longstanding ambition of ethnic cleansing, and policy driven proscriptions of land holding rights are root causes of internal displacement. Although local integration of IDPs as unlocking solutions remain useful, various shortcomings hamper the success of IDPs local integration. This include land, housing, employment, policy constraints and fear of creating pulling conditions for further displacements. The existing prospects of IDPs local integration goes with ethnocultural sameness of IDPs and the host, IDPs possession of material property in the host and durable solution initiatives proclaimed by the Ethiopian government. The major conclusion of this study reveals that unless the causes of internal displacement resolved for return and whenever other options are at hand, by default IDPs get integrated with the host even irrespective to the resource impediment that challenge survival. Key terms: Ethnic conflict, displacement, IDPs, durable solution, local integration, Sekela woreda.