Highly active antiretroviral therapy (HAART) played a critical role in the medical management of HIV infected individuals by restoring the immune function and minimizes HIV related outcomes. But treatment failure minimized these advantages and leads to an increment of morbidity and mortality with poor quality of life in all HIV patients. The aim of this study was to assess the prevalence of HIV/AIDS treatment failure and its determinants factors among patients on first line HAART at Felegehiwot Referral Hospital. Cross sectional study was conducted on 421 participants who had started first line HAART during August 01/ 2016 to September 30/2016. Data were collected from patients‟ chart starting from ART commencement (baseline data and other information) and face to face interview using structured questionnaire. CD4 T cells from whole blood and viral load from separated plasma were analyzed according to protocols. The collected data were analyzed using SPSS packages version 20. Descriptive statistics, odds ratio, positive and negative predictive values, life table, receiver operating characteristics curves, bi-variate and multiple logistic regression were used to analysis. Independent associations were considered with p<0.05. Among the 421 participants enrolled, 243(57.7%) were females. The mean age was 30.2 years and the median months on HAART from initiation were 81 months. A total of 45(10.7%) participants were found to have treatment failure. The mean CD4 T-cells at initiation were 268.38cells/ml. The median time to detect virologic failure was 47 months. Sensitivity of immunologic failure in predicting virologic failure was 62.2%. Long duration on treatment, sub-optimal drug adherence (odds ratio: 9.55), conducting faith healing, immunologic failure, high medication dosage, ambulatory functional status at baseline and not feeling privacy during consultation and counseling were found to be significant predictors of treatment failure and positive odds ratio. Prevalence of treatment failure in Felegehiwot Referral Hospital needs high attention. Viral load determination in detection of treatment failure was earlier than CD4 T cells so immunologic failure in detecting virologic failure was acceptable. Adherence of treatment and other factors like duration on treatment was the predictor to treatment failure and should be assessed frequently.