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It is believed that since the advent of agriculture, changes in land use and land cover (LULC) have happened. However, rates, extents and intensities of LULC changes have become more aggravated at all levels. The current study aims to examine the dynamics and perceptions of LULC change in the last four decades in Aykoleba, Ethiopia using a combination of remote sensing data and the ground truth data. Focus group discussions were employed to obtain data on the status of land degradation. Remote sensing data were obtained using Landsat imageries of MSS (1973), Landsat TM, 1986 and 2000, and Landsat ETM+ (2013) with 30 m spatial resolution. ArcGIS10.2 and ERDAS Imagine13.1 were used to generate LULC classes. Accordingly, four LULC classes were identified, of which forest and bare LULC have been augmented by 8.8 and 54.9%, respectively. The escalation in forest cover is associated with plantation of eucalyptus near the home gardens, farmlands, and degraded areas. Nevertheless, open bush and grassland, and cultivated and settlement land cover classes were lessened by 27.4 and 37.8%, respectively although increase in bare land is related to abandonment of the cultivated land in hilly and sloppy areas, and overgrazing, among other factors. The local community perceived that population pressure is a top driver of LULC change in the study area. Overgrazing and lack of appropriate land use policy are also significant causes of change. Thus, the establishment of land use plan and appropriate population policy is recommended in Ethiopia.