Access to safe and adequate water is vital for preservation of human health and socio-economic development. However, there is limited provision of this basic service in the study area. Besides, significant numbers of water supply schemes that contribute for service coverage are poorly managed; provide service with problems and others are malfunctioning at any time. As a result, the number of people accessed to safe water has reduced. This study therefore, has attempted to assess factors hindering sustainability of rural water supply schemes in Dega Damot woreda. In order to obtain the required information to meet the objectives of the study, mixed (purposive and random) sampling technique was employed. Accordingly, a total of 123 sample households were selected by using Kothari, 2004 formula of sample size determination. Data obtained from household survey were mainly analyzed quantitatively while information from focus group discussions, key informant interview and personal observations were analyzed qualitatively to supplement data from household survey. The survey result found out that sustaining the proper functionality of the schemes has been one of the major problem and foreseeable bottlenecks in the study area. The study also identified that 41.7% of water supply schemes are malfunctioning during the time of the survey. Besides, the functional schemes are also found poorly managed and provide service with problems. The survey result revealed that schemes are managed by communities through water committees who are responsible for the overall management of the schemes. However, the study found that water committees were not capable of managing the schemes properly as they lack the skills and basic trainings on the financial, technical and overall management. Absence of spare parts at all levels was also identified as one of the major problem to carry out repairs when needed. Therefore, the findings call for the need to give attention by the concerned body in sustaining of the existing water supply schemes by getting the solutions and/or by taking measures to the stated and other related problems. Key words: sustainability, water schemes, nonfunctional water project, woreda.