Developing viable financial market in general and finance leasing business in particular is highly determined by the conduciveness and comprehensiveness of the legal framework that governs and regulate the operational and the transaction of the sector. Despite the efforts that Ethiopia has exerted to bring legal framework that govern the business of finance leasing by introducing capital goods leasing proclamation No. I OJiJ 998 and by making comprehensive amendments to this proclamation with a view to add regulatory framework for the business. there are still many gaps and drawbacks in the legal framework in regulating the transaction of finance leasing which could be undermine the development and widespread use of the sector. Hence, the basic objective of the study is to assess the adequacy mid comprehensiveness ofthe legal framework of finance leasing in Ethiopia and identify the gaps and recommend the possible solution. Jn conducting the study, general principle pertaining to basic content of finance leasing legal framework as developed by certain known international Institution and experiences of some purposively selected countries based on their successes and relevance to Ethiopia have been used. In . addition, there is in depth legislative analysis that pertains to finance leasing in Ethiopian and comparison is made with the experience of the above countries and guidelines and models developed by certain international institution in order to identify the gap of the Ethiopian legal regime of finance leasing and to draw the possible lessons from this international experience. Accordingly, the study has found that failure to require the lease rental and lease term to take in to consideration the full or substantial amortization of leased asset. limited application of the proclamation only to capital goods, failure to recognize the right of the lessee to enter in to sub-lease agreement, failure to devote specific and independent provision that determine the respective right and duty of parties in detail and comprehensive manner are the major gaps and shortfall of the proclamation. Moreover, failure to recognize parties freedom to contract, lessee 's right to directly recourse against the supplier. the supplier's duty to warrant defect, non-conformity and delivery of the leased asset; failure to limit the liability of the lessor in relation to defects, non-conformity, unfitness. and delivery of the Leased asset; failure to affirm the independent nature of the duty of the lease to pay lease rental; failure to recognize the absolute duty of the lessor to warrant defects related co his title over the leased asset and quite possession of the asset by the lessee. and failure to determine the right and duty of the supplier makes the proclamation inadequate and defective in regulating the right and duty of parries in comprehensive manner. Apart from this, the study found that the proclamation failed to regulate the rime when risk transfer from the supplier to the lessee, the right of parties to transfer or assign their right and duty, the amount uf damage that can be claimed by the aggrieved party and the manner of its determination, and the procedure and the process of re­ possessing the leased asset. Finally the study has ended up with recommending possible solutions which may serve as inputs for stakeholders to re-design the legal framework of finance leasing in Ethiopia so as tu bring about comprehensive and adequate legal regime 10 the country .