Agricultural information is a vital resource for improving long-term productivity and supporting rural, social, and industrial development. However, access and effective utilization remain limited among smallholder farmers. This study investigates the utilization of agricultural information and its impact on the welfare of smallholder farmers in the East Gojjam Zone of Amhara, Ethiopia. Primary data were collected from 403 households using a multi-stage sampling technique, supplemented by focus group discussions and key informant interviews. Secondary data were obtained through document reviews and electronic sources. Data were analyzed using descriptive statistics and advanced econometric models, including Ordered Probit, Multivariate Probit, Propensity Score Matching (PSM), and Logit models. The findings indicate that smallholder farmers primarily access information via radio, the Office of Agriculture, extension workers, family members, neighboring farms, and Farmer Training Centers (FTCs). The Ordered Probit model shows that farm experience, media exposure, farm size, participation in FTCs, and access to extension services significantly influence agricultural information utilization. The Multivariate Probit model reveals that farm size, membership status, access to credit, proximity to markets, extension services, total income, and willingness to share information positively affect farmers’ preference for electronic information outlets. Conversely, frequent market visits and shorter distances to development centers negatively influence this preference. Educational level, total farm size, total income, and cooperative membership positively affect the use of printed outlets, while family size and market visit frequency have negative effects. Organizational outlet choice is positively influenced by cooperative membership, income, distance to markets, and extension access, but negatively by marital status and education. People-related information preference is strengthened by membership status but reduced by large family size. The study also evaluates the impact of Agricultural Information Utilization (AIU) on wheat productivity and income using PSM and Endogenous Switching Regression (ESR). PSM minimized selection bias and showed that users achieved, on average, 197 kg/ha more wheat and earned 8,370 ETB more income than non-users. ESR results confirmed users gained 1,300 kg/ha and 14,000 ETB more compared to their counterfactuals. Non-users were projected to gain 950 kg/ha and 18,000 ETB if they adopted information use. These findings highlight the strong positive impact of AIU on productivity and livelihoods. The study is grounded in the Diffusion of Innovations Theory, Access to Information Theory, and the Sustainable Livelihoods Framework, which explain how communication channels, access barriers, and institutional factors shape information uptake and its effects. It recommends improving access and dissemination of agricultural information through integrated communication strategies. Strengthening farmer training and extension services especially via digital platforms and community networks can enhance productivity and welfare. Policymakers and stakeholders should prioritize these actions to close existing gaps and support rural development.