Ethiopia is frequently faced with climate-related hazards, commonly drought and floods and its agricultural products decrease time to time. As irrigation plays an essential role in stabilizing crop production by either supplementing or replacing the need for natural precipitation and it makes agriculture more confidential, the governments of Ethiopia has followed the development of small-scale irrigation (SSI) schemes for the adaptation and mitigation strategy to increase productivity and to diversify the livelihood scenarios as an option. But, how much the country has 5.3 million hectares of irrigable potential land and the governments of Ethiopia followed the development of small-scale irrigation, still only 5 to 10% of this potential land is irrigated and produces less than 3% of the total food production of the country. So, this review was conducted in order to find out the factors that affect irrigation agriculture development in Ethiopia from different literatures to provide useful information to decision makers for the planning, managing and developing of positional irrigable land of the country for the alleviation of recurrent drought in the country. Different literature indicates that minimum development and small production of irrigation occur in Ethiopia due to different challenges like, inadequate awareness of irrigation water management, inadequate knowledge on improved and diversified irrigation agronomic practices and factors like environmental, social, economic and political. So, in the country for minimization of these challenges and factors, and to increase irrigation development, irrigation project should be developed based on integrated and grass root approach.