Genetic variability studies provide basic information for breeders to develop different stress-tolerant varieties. In the present study, forty-nine Tef genotypes were evaluated under strong acid soil (pH 4.97) and lime treated (pH 5.90) soils in the lathouse at Assosa Agricultural Research Center in 2017 to estimate the genetic variability, heritability and genetic advance of various traits of tef genotypes in relation to soil acidity stress. The result indicated that there was high significant (p<0.01) differences among genotypes for all traits under both environments; except for shoot biomass in the combined data analysis. The two environments differed significantly in their effect on all traits except on plant height, panicle length, culm length, total and fertile tillers and number of primary branches, although environment contribution to total TSS was less than 10% in 13 of the 17 traits studied; its high contribution was to harvest index (42.6%) and grain yield pot-1 (32.5%). Big reduction due to soil acidity was recorded for yield of primary panicle (27.78%), grain yield pot-1 (33.85%) and harvest index (35.6%). A contribution of G was from 44.5% in harvest index to 90.5% in panicle length. The GxE interaction was also significant for all traits and it contributed more than 15% in 11 of the traits, indicating inconsistency of performance of genotypes under acidic and lime treated soils. PCV, GCV, and GAM were high (>20%) for fertile tillers per plant, panicle weight, yield of primary panicle, grain yield, and harvest index under both acidity levels and in the combined analysis. Heritability was high (>60%) for all traits except for shoot biomass in the combined analysis and lime treated soil. In general, there was wide genetic variability in the traits studied pointing to the possibility of improving the desired traits, including grain yield under both environments and over environments through the selection of elite genotypes.