The study was carried in Bisare watershed, south rift valley of Ethiopia. The total area drained by this watershed is around 547 square kilometers. Satellite image and GIS technologies in conjunction with data collected through field surveys, were used to analysis land use/land cover changes that took place in the area between the years 1973 and 2003. In this study, Landsat satellite images MSS (1973), TM (1984) and ETM+ (2003) data were used to identify the land use/land cover status of the area. Based on maximum likelihood classifier, the area was classified into five major land use/land cover classes such as cultivated land, wooded-grass land, shrub and bush land, grass land, and bare land. An increase of 11,596.4 ha (8.3% in the first period (1973-1984) and 12.9% in the second period (1984-2003)) of cultivated land was observed. It was found that much of the current cultivated land is established at the expense of shrub and bush land. A total of 3,993.1ha, 5,360.6 ha, and 5,251.2ha of wooded-grass land, shrub and bush land, and grass land were lost or converted to another land use/land cover type during the study period. More than a four-fold increase of bare land i.e. 3,008.5ha was observed during the study period.