This study was initiated with the objective of describing the existing avocado production and marketing system, assesses its economic role in the society and point out problems and potentials in the system. Formal and informal surveys were employed to collect the data and descriptive statistics, Net benefit and margin analysis were employed to analyze the data. According to the result, farmers plant avocado either as a sole by using 7x7 m spacing or intercrop with coffee and other fruits. The average amount of fruit bearing trees in an individual farm is 8.11 with an average harvest of 195 kg tree-1 and this made farmers get an average income of 2111.58 birr from the sale of avocado in one production season. Avocado is channeled from producers to wholesalers, retailers, local collectors and cafeterias. From all these market participants, Wholesalers get the largest gross margin (35.41%) from the final consumers price. Production is challenged by vegetative growth after fruit bearing stage, longetievity, Pest attack, disease and absence of improved management practices. Hence research work on disease and pest and generation of improved management practices are very crucial to avoid such production pitfalls.