Background Work-related stress and anxiety are emerging global public health problems causing serious social and economic consequences. Working women bear a heavy burden due to high social disparity, gender inequality, and an important responsibility to balance work and family life in undeveloped society. Objective To assess the prevalence and associated factors of work related stress and anxiety among female employees of Hawassa industrial park in Sidama Region, Ethiopia, 2021. Methods Institution-based cross-sectional study design was conducted among 417 female employees using structured interviewer-administered questionnaires and depression, Anxiety, and Stress scale (DASS) 21 items. A simple random sampling technique was used through the computer-generated random method. The outcome variables were work related stress and anxiety. Work related stress and anxiety were ascertained using the DASS 21( stress ≥ 15 &anxiety8 – 14). The associated factors assessed included sociodemographic, behavioral factor, job and organization related factors, past illness and social support related factors. Bivariate and multivariable logistic regression analyses were done. The strength of association was declared by using an adjusted odds ratio (AOR) with a 95% confidence interval and, the statistical significance of P-value < 0.05. Result The prevalence of work-related stress and anxiety were 59.3% [95% CI: (54.7, 63.9)] and 79.8% [95% CI: 75.5, 83.6)] respectively. Respondents with single marital status [AOR = 5.31, 95% CI: (1.68, 16.86)], having chronic illness [AOR = 4:00, 95% CI: (1.24, 12.9)], and current alcohol drinking [AOR = 12.5, 95% CI: (4.56, 34.2)] were significantly associated with stress. Likewise, being single in marital status [AOR = 1.99, 95% CI: (1.15, 3.46)], poor social support [AOR = 3.78, 95% CI: (1.53, 9.35)], overtime work [AOR = 2.31, 95% CI: (1.12, 4.74)], having work experience (3–4 years) [AOR = 4.71, 95% CI: (1.49, 14.84)], and fear of losing job [AOR = 1.72, 95% CI: (1.01, 2.93)] were significantly associated with anxiety. Conclusion The prevalence of work-related stress and anxiety was high in the study area. Marital status, alcohol drinking, and chronic illnesses were factors associated with work-related stress. In contrast the fear of losing a job, work experience, overtime work, and having poor social support were factors associated with anxiety.. The significant factors identified in this study can be targeted to reduce the occurrence of work related stress and anxiety among women through designing preventive programs and strategies which includes acknowledging the importance of mental health services for the welfare of the public, screening for work related stress and anxiety, counselling, and the provision of support for women as well as lifestyle modification.