The idea of lean thinking in construction project is to minimize waste, improve communication among the stakeholders and encourage teamwork as well as integration through a common set of tools and techniques. The current practice observed in Ethiopia building construction is the common or the traditional one; which make the industry non-productive and the improvement for increase productivity is static parallel to other industry. Even though there are many research studies that deal about cause and minimization of material wastage in Ethiopia and abroad, there is a gap in cause, effect and minimization measures of physical and nonphysical waste by using modern construction approach, such as lean technique. The objectives of this paper is to assess building construction project waste, how lean construction techniques reduce those waste and improve performance in building construction project by providing a new knowledge on the current situation and determine the implementation barrier for lean construction approach in Ethiopia specially in Bahir Dar. The paper focus on lean construction techniques to overcome problems, facilitate project progress, and offer recommendations for better public construction project processes. The thesis will determine a cause, identifies and categorizes the waste, and take remedial actions through application of appropriate lean techniques and focus on investigating implementation barrier of lean construction approach. To address successful implementation of Lean approach qualitative research method were applied and perception of adopting new philosophies like Lean approach were analysed, cause of waste were categorized by controllable cause associated with flow, management activity, change or conversion and uncontrollable or external causes, whereas wastes also categorized based on the judgment of the construction professionals’ experience. Lean related tools that are used to reduce waste and improve performance of project also assessed their application for different projects. The results from questionnaire survey were correlated and discussed with the data gathered qualitatively. Proposed simple conceptual framework for implementing Lean construction approach also incorporated in this thesis. Finally, conclusion and recommendation were drawn based on collected and analysed data on waste and its reduction way through lean approach. Key words: Wastage, Lean construction, Level of knowledge