Rural land registration has frequently been recommended as a step forward for developing countries. Registration is conceived not only as a means of clarifying property rights and promoting land markets, but also as a way to protect the rights of women and other vulnerable groups and prevent environmental degradation. This package of advantages was once associated with the land rights of individuals. However, more recently, customary interests have been recognized as important for social peace and as serving local conceptions of justice. In recognition of these objectives, Ethiopia and some other countries of sub‐Saharan Africa have formally recognized what are often called “customary land rights.” Ethiopia is cited as a model of this approach in a multicultural setting. This paper shows, however, that serious problems associated with rural land registration have not disappeared. Fieldwork evidence from parts of Ethiopia suggests that customary property interests often go unrecognized. It also shows that the bargaining power of smallholder farmers who rent land to commercial farmers is being reduced. Simultaneously, there is an evident shift in decision‐making power from households and communities to the state and officials. The complexity of these matters in practice raises questions about the interpretation of Ethiopian land policy.

Since the end of the Cold War, the World Bank and other Western development agencies have prescribed restructuring land rights in post-communist economies to promote land markets, with the goal of alleviating poverty and social conflicts. But restructuring land rights in such settings is more difficult than it may seem. Ethiopia’s efforts in this area have produced disparate laws that have exacerbated both the intensity and the frequency of land conflicts. This article analyzes all land cases decided by the Council of Constitutional Inquiry (CCI) and the House of Federation (HoF), Ethiopia’s constitutional review bodies, from 1998 to 2018. It shows that from 1998 to 2014, the trial and appellate courts were favorably disposed toward the policies of international financial agencies, and that the CCI and the HoF acquiesced. However, starting in 2014, following a countrywide protest connected to land dispossession, the CCI and the HoF have reversed the lower courts’ judgements by invoking constitutional clauses declaring that land belongs to the Ethiopian nations and that it cannot be alienated. The country’s experience reveals the perils of restructuring land rights without paying close attention to distributive concerns and the needs of those who end up being excluded from property access.