Ethiopia is known by multiethnic and cultural diversity. Using traditional medicine is widespread practices in the country. However, a limited ethnobotanical study on medicinal plants alongside the indigenous knowledge exists. This study was carried out from October 18, 2022 to May, 2024 to get valuable information from three selected kebeles of Banja District, northwestern Ethiopia. The aim of the study was to explore and document the diversity of medicinal plants and associated indigenous knowledge in the study area. A total of 387(319 males and 68 females) individuals were selected randomly and purposefully from the representative kebeles. In terms of informant type, 62 were key informants chosen through a purposive sampling method, while the remaining 325 were general informants chosen at random by lottery technique. A guided field walk, group discussion, semi-structured interviews and market surveys were used to collect ethnobotanical data. Descriptive statistics (frequency and percentage), informant consensus factor, fidelity level, preference and direct matrices rankings and inferential statistics (independent sample t-test and ANOVA) were used to analyze the collected data. A total of 77 medicinal plant species belonging to 71 genera and 43 families were collected and documented. The family containing the highest number of medicinal plant species was Fabaceae with 8 (10.4%) species followed by Solanaceae with 7(9%) species. Out of these, 30 (39%) were collected from the wild, 41 (53.2%) were collected from the home garden and 6(7.8%) were collected from both the wild and the home garden. Of the total species, 58 (75.3%) were used to treat human ailments and 9 species (11.7%) were used to treat livestock ailments and 10(13%) were used to treat both human and livestock ailments, respectively. Herbs constituted the dominant growth forms with 33 (42.8%) species, followed by trees and shrub with 20 (26%) each species of the medicinal plants studied. The most frequently used plant parts were leaves (38.14%) followed by seeds (25.4%). Oral administration was the dominant route (59.3%) followed by dermal (24.6%). Medicinal plants with higher informant consensus included Phytolaca dodecandra, Brucea antidysenterica and Euphorbia abyssinica while the disease category with the highest informant Consensus Factor value (0.88) was gastrointestinal disorder and parasite infection. There was high preference for Plantago lanceolata for treating wound. Eucalyptus globulus was shown to be the top multipurpose species while Charcoal production and firewood collection, agricultural expansion, overgrazing, fencing and construction were reported as major threats to plants of the study area. Some local people used ex-situ conservation method and also in-situ conservation technique for different purpose. Thus, the local communities of the study area need to involve in conservation and management of plants in general and medicinal plants in particular. Keywords; Conservation, descriptive statistics, ethnobotany, indigenous knowledge, medicinal plants, Traditional healers