Theaim of this study was to analyze the water quality at the head of Gilgel Abbay River using physicochemical parameters and macroinvertebrate indicators. Physicochemical and macroinvertebrate data were collected from February to April 2018 and samples were taken from three sites. A total of 4215 macroinvertebrate individuals belonging to 33 families were collected by surber sampler and identified based on the rapid bio assessment protocols for use in streams and wadeable rivers. Percent of EPT, Chironomidae, non insect taxa, dominant taxa, Oligochaetae, Odonata, tolerant organism, Diptera, and indices such as Species evenness, Shannon Wiener diversity index and Hilsenhoff family level biotic index were calculated and related to physicochemical parameters. The analysis of variance for most of physicochemical parameters showed significance difference among sampling sites and some physicochemical parameters differ among months(p<0.05). Taxa richness, % of EPT and Shannon Wiener diversity index were higher at S1than S2 and S3 but % of Diptera, Chironomedae, non-insect taxa, Dominant taxa and H – FBI increased significantly at S2 and S3 than S1(p<0.05). Significance correlation was observed between physicochemical parameters and macro invertebrate indicators. pH was negatively correlated with % of EPT and EPT taxa richness (p<0.05) and TDS and conductivity were positively correlated with % of non-insect taxa. Sulphate concentration showed negatively correlation with % of EPT (p<0.05). The Macro invertebrate community index of Gilgel Abbay River (MCIGAR) was developed from seven core metrics. S1(reference site) scored 88.5 were classified as excellent water quality and the two downstream sites located in Fano bridge(S2) and Kolele Mewcha(S3) scored 42.8 and 37.1 respectively were classified as poor water quality.In conclusionphysicochemical parameters(phosphate and turbidity) and macroinvertebrate metrics(taxa richness,% of EPT, Oligochatae, Dominant taxa and FBI indicates that the water quality at the head of GilgelAbbay River was somewhatimpaireddue to human activities for washing clothes, cars, addition of domestic wastes and watering cattle. Establishment of vegetative buffer zone and Proper Waste disposal is required at Gish Abbay town. Key words: Gish Abbay, Macroinvertebrate, physicochemical parameters,Waterqualit