Gully erosion in the Ethiopian Highlands dissects vital agricultural lands with the eroded materials adversely impacting downstream resources, such as siltation of reservoirs. While gully expansion and rehabilitation have been more extensively researched in the semiarid region of Ethiopia, few studies have been conducted in the (sub) humid region. For that reason, the researcher assessed the severity of gully erosion by monitoring the expansion of nine selected permanent gullies. The head-cut retreat, gully widening, gully expansion rates and associated amount of soil loss along the total gully length were monitored during 2020 -2021 rain seasons. Ground water depths were measured using nine piezometers installed 5-10 m above each gully head. The results showed that soil loss was caused by upslope migrating gully heads through a combination of gully head collapse and removal of the failed material by runoff. Collapse of gully banks and retreat of head cuts was most severe in locations where elevated groundwater tables that saturate gully heads and banks, destabilizing the soils by decreasing the bank soil strength. The water table monitoring showed that elevated groundwater tables were the most important cause of gully collapse. Similarly, the result indicated that additional factors that strongly relate to bank collapse were the height of the gully head and the size of the gully catchment. Conservation practices that address factors controlling erosion are the most effective in protecting gully erosion. These consist of lowering water table and reshaping the gully head and sidewalls to reduce the occurrence of gravity-induced mass failures.