Mastitis is a major prevalent and costly disease among dairy industries worldwide, causing a reduction in milk yield and quality, increased milk wastage. A cross-sectional study was carried out from April to August 2024, to estimate prevalence of mastitis, identify potential risk factors, to isolate common mastitis causing pathogens and to assess awareness of disease among participants in and around Injibara dairy farms. One stage cluster sampling method was used to select representative sample of a population. Besides, a questionnaire survey was conducted on 47 dairy farm attendants to quantify economic losses. Out of interviewed attendants 48.94%, 53.19% and 42.55% had knowledge, positive attitude and good preventive practice towards mastitis disease respectively. A total of 47 dairy farms, 282 lactating cows and 1,128 quarters were tested using California Mastitis Test kit and physical examination. The present study revealed that the overall prevalence of bovine mastitis at herd, cow and quarter level was 55.32%, 17.38% and 6.59% respectively. Out of 282 cows tested 4.26% clinical and 13.12% was sub-clinical mastitis. Multivariable logistic regression showed that cross breed (AOR: 10.67; 95% CI: 2.524 – 45.091, P = 0.001), poor body condition (AOR: 5.95, 95% Cl: 1.282 – 27.586, P = 0.023), and previous history of mastitis (AOR: 35.14; 95% CI: 9.834 – 125.6, P < 0.001) were significantly associated with mastitis. The common mastitis causing pathogens isolated in this study were Staphylococci (56.52%), Streptococci (21.74%), E.coli (13.04%) and mixed growth (8.70%). The overall economic loss in the current study was 4,354.90 USD comprising 910.65 USD due to sub-clinical mastitis, 636.56 USD from clinical mastitis, and 2,807.69 USD results from decreased cow value of affected cows. On average, the economic losses per farm were 145.16 USD, while 67 USD were lost per infected dairy cow in one lactation period. In conclusion, this result revealed that the prevalence of mastitis was found to be moderate, with a considerable economic loss in and around Injibara town. This prevalence had a significantly impact on the productivity of dairy herds in the study area. The objective of study was to estimate the economic losses associated with mastitis. This necessitates an evidence based integrated prevention and control strategic measures to minimize prevalence and economic loss in the study area.