This study was set out to explore the implementation of communicative grammar teaching and challenges on its implementation in EFL classes at Aferwanat General Secondary and Preparatory School. The researcher used a descriptive survey design and mixed methods approach in conducting this study. The sample of the study consisted of four (4) availably selected EFL teachers and ninety-six (96) randomly selected grade 11th students. Three data gathering tools were used to obtain the desired data from participants: questionnaire, classroom observation and interview. The data collected with these instruments were examined numerically (quantitatively) as well as qualitatively. The data from a questionnaire were analyzed using descriptive statistics such as mean, percentage, and frequency, whereas the data from the observations and interviews were analyzed qualitatively. The overall findings of this investigation demonstrated that grammar was not taught on account of CLT in EFL classes of the target school. Teachers were found still sticking to the traditional teacher-fronted methods of grammar teaching. The findings further indicated that the challenges that hampered the implementation of CGT were related to teachers themselves, the students, the educational system, and the difficulty of CLT principles to apply in the local environment. Among the prevailing multi-faceted problems that hampered teachers on their CGT implementation, the most serious ones in this study could be summarized as (i) poor English language proficiency of both students and teachers, (ii) limited time, (iii) non-English speaking environment, (iv) large class size, (v) lack of authentic materials, (vi) students‟ expectation (excessive dependency of students on their teachers), (vii) students‟ lack of interest in developing their communicative skills, and so on. Finally, this study made some recommendations to all stakeholders, including teachers, school administrators, educational bureaus of Dera District, South Gondar Zone and the Amhara Region, colleges, universities, Ministry of Education, and policymakers to work hand in-hand to ensure the success