Ecosystems provide resources that are necessary to the survival of people and nations, both for subsistence and for economic mainstay. Driving forces behind ecosystem degradation are many and interlinked. One reason for this is that many ecosystem services do not have a market value and, thus, their benefits may not be considered in commercial development decisions and broader public policy initiatives furthermore, many of them are generally open-access with ill-defined property rights, enabling rivalry and incentives for individual benefit. Like many natural resources, Lake Tana has the characteristics of public good which is non-excludable and nonrival or available for all. Currently, Lake Tana is being disturbed and threatened by various factors. The Lake is probably the most studied lake in the country. Different researches have conducted on different aspects of Lake. Those studies mainly focused on tourism development, infrastructural development, fisheries and transportation with little or no reference to the assessment of the economic value of protecting the Lake. Therefore, the aim of this research is to bridge this gap. The main objective of this study is, therefore, is to examine people’s WTP for the protection of Lake Tana considering 400 randomly selected respondents from different kebeles, Island, peninsula, peasant associations and tourists(both domestic and abroad). Using single bounded dichotomous choice format with a follow up open-ended format, 215 (74.9%) of residents and 75(66.3%) of tourist respondents were agreed to pay the initial bid amount for conservation of the lake. The mean WTP was estimated to be 71.19 birr per visit for tourists and 51.14 birr per year for residents. From Econometric results, Probit and Tobit models, the respondents’ willingness to pay was positively influenced by sex, marital status, education, income of respondent, occupation, origin (residents/visitors), number of trip and job opportunity. Whereas, age of respondent and distance are negatively affect willingness to pay. Family size had both positive and negative effect on WTP under probit mode but it have only negative effect under tobit model. Generally, creating awareness in society, whether they are users or non-users, about the importance of the lake and the impacts of their activities, even though it is for current income generation, must be the role and home work for policy makers.