Background As a result of the coronavirus disease 2019 (COVID-19) outbreak, many countries have imposed movement restrictions and implemented lockdowns. However, evidence from a variety of nations showed that the COVID-19 outbreak and its associated quarantine measures triggered a wide range of psychological problems, such as anxiety, depression, and stress in the general population. As a result, the purpose of this study was to determine the prevalence and predictors of depression, anxiety, and stress symptoms among Tepi town residents during the pandemic lockdown. Methodology A community-based cross-sectional survey was conducted among residents of Tepi town from September 15 through September 25, 2020, and residents who have lived in Tepi town for at least 6 months were included. We have employed the depression, anxiety, and stress scale 21 (DASS-21) to evaluate depression, anxiety, and stress. The Chi-squared test of association and logistic regression were used to identify factors associated with depression, anxiety, and stress among residents of Tepi town. For all statistical analysis, we used (IBM) SPSS version 25. Results According to the current study, the prevalence of depression, anxiety, and stress symptoms were 37.7%, 39.0%, and 44.2%, respectively, among residents of Tepi town. Estimated odds of having depression, anxiety, and stress were as follows: