The objective of the study was to undertake on-farm phenotypic characterization and breeding practices of indigenous sheep population and its cross with Awassi in selected districts of South Wollo zone; Eastern Amhara, Ethiopia. Three districts were selected purposely based on their flock size, sheep production potential and their contribution to the farmers. About 180 households from Wogide, Borena and Legambo districts were used for household survey, body weight and linear body measurements were taken from 525 sheep 405 from indigenous sheep and 120 from local x Awassi crossbred. Data collected through questionnaire were described by using descriptive statistics; qualitative data were analyzed for male and female sheep using frequency procedure and quantitative traits analyzed by using general linear model procedure. The parameters were analyzed using SPSS and SAS software. Among the livestock species, sheep was dominant in the study areas. The highest contribution of sheep in Legambo district for food and income of the family for smallholders indicated that the area is in favor of sheep than crop production. The survey discovered the high proportion of uncontrolled mating in the study areas. The main objectives of keeping sheep were for income generation followed by meat consumption and saving. Appearance/conformation, fast growth, coat colour, lambing interval, age at first sexual maturity and tail size were the most important traits for selection of breeding rams and ewes in the study areas. Local x Awassi crossbred had poor or lower reproductive performance than the indigenous sheep. Feed shortage and disease prevalence were the most vital sheep production constraints in the study areas. Indigenous sheep and local x Awassi crossbred were classified short fat tailed (100%) and the tail was curved upward at the tip 96.79% for indigenous sheep and 99.20 for local x Awassi crossbred. Body weight and most of the linear body measurements of indigenous sheep population were significantly affected by districts (P<0.01). Body weight of indigenous sheep in Wogide (24.9±0.38 kg) and Borena (25.7±0.39 kg) district were significantly higher (P<0.05) than indigenous sheep in Legambo (22.1±0.41 kg) district. Sex had significant effect (P<0.01) on body weight and some of the linear body measurements. Body weight, chest girth, wither height and rump height were 26.09±0.47kg, 69.50±0.57cm, 63.66±0.46cm and 68.19±0.44cm for male and 22.46±0.31kg, 67.17±0.37cm, 60.64±0.30cm and 64.85±0.29cm for female indigenous sheep, respectively. The interaction of sex and age group was significant (P<0.01) on body weight and linear body measurements. Crossbreds found only in Legambo district and results showed Awassi x local crossbred sheep had significantly higher (P<0.01) in body weight and body measurements than indigenous sheep in Legambo district. Community-based crossbreeding was successfully improved productivity