Back ground: Increasing institutional delivery service utilization of mothers under the care of skilled birth attendants throughout pregnancy and delivery is important key to reduce maternal mortality and improving maternal health. Maternal mortality and morbidity is highest in Ethiopia and also majorly contributes maternal death in the world. The reason for this huge magnitude of the problem is the low use of delivery care service. However, the least utilization of institutional delivery and the factors that influence this utilization were not investigated in study area. Objective: the aim of this study was to assess proportion of institutional delivery service and its associated factors among mothers who gave birth for the last one year in Gilgelbeles administrative town, North Western Ethiopia, 2020. Methods: Mixed type of study design was conducted from February 1-30 /2020 among 422 mothers. For quantitative part, simple random sampling technique was used to reach the study participants and data were collected by using interviewer administered structured questionnaire.. Data were entered by Epi Data 3.1 version and were analyzed by using SPSS 23.0 version. Bivariate and multivariate logistic regression analyses was employed to estimate the crude and adjusted odds ratio with 95% confidence interval and p-value <0.05 were considered as statistically significant. For the qualitative part of the study, in depth interviews were used for data collection and thematic analysis was used to supplement quantitative result. Result: This study identified that 39.57% with 95% confidence interval (34.6, 43.8%) of the participants gave birth in health institution. Multivariate logistic regression analysis showed that, ANC follow-up during pregnancy[AOR=9.9(95%CI:3.9,25.2)],decision making power [AOR=3.24(95%CI:1.4,7.4)],using traditional medication during labour [AOR=8.35(95%CI:2.8,24.5)],Knowledge about danger signs during pregnancy [AOR=4.49(95%CI:2.09,9.67)] and maternal level of education[AOR =4.4(95%CI:1.2,15.7)], [AOR =8(95%CI=(1.6,40.7)] were significantly associated with institutional delivery. Conclusion: The prevalence of institutional delivery was low. This calls for accelerated, integrated and appropriate interventions to be carried out by all stakeholders to increase institutional delivery. Key words; Proportion, institutional delivery, Gilgelbeles administrative town, Ethiopia