In this paper, the issue of failure assessment in the drinking water distribution system was presented. This specific study was conducted on the water distribution system on the main campus of Bahir Dar Institute of Technology. The problem of drinking water supply distribution system failure is a critical issue in waterworks practice. The current problem in Bahir Dar institute of technology is that the water infrastructure is aging and has not been spending adequate to repair, replace, or rehabilitate drinking water distribution systems. This develops higher stresses on the water distribution network causing pipes to crack, or rupture permanently while in service. Due to this problem the whole water supply components in the distribution network lead to increase water loss and quality reduction. The general objective of this study is to assess the risk of the water distribution system in Bahir Dar Institute of technology water supply distribution system. In this study, a structural risk assessment was developed by using ARC GIS 10.1 and Water Cad V8i to get prioritize maps of the water distribution system and hydraulic analysis of the drinking water distribution system of the institute. In developing this assessment, the score was established based on the preset criteria to evaluate customer point risk and structural point risks such as water quality, water availability, pressure head adequacy, the flow rate of water, pipe, storage facility, and pump. Based on the result obtained from an equal weight approach, the score of drinking water distribution system risk index is a medium level (2.56) with a low level of structural risk (2.5) and a medium level of consumer point risk (2.62). The results evaluated by AHP method, structural risk has had the highest weight score (76%) which means it needs more priority than consumption point risk (24%) and the result of drinking water distribution system risk index laid at the medium level (2.7), it indicates the institution drinking water distribution system put at the satisfactory condition with the sum up the effect of medium structural risk index (2.65) and medium consumption point risk (2.82). Based on the result obtained and the conclusion is drawn from the study, the campus water supply distribution system components especially some of the pipe and most of the pump should be replaced before out of date and take appropriate prevention action.