Escherichia coli O157:H7 is one of the most important emerging foodborne pathogens and cause life-threatening disease condition in consumers worldwide. A cross-sectional study was carried out from February 2020 to August 2020 in Gojo and Shukute towns, Jeldu district, West Shewa Zone, Oromia region, Ethiopia to isolate and identify E. coli O157:H7 from raw cow’s milk samples and determine antimicrobial susceptibility of the isolates. A total of 262 milk samples (127 from Gojo and 135 from Shukute towns) were collected from dairy cows (126 from udder, 115 from milking bucket) and 21 from collection tanks and examined bacteriologically. The isolates were tested with a series of biochemical tests followed by a latex agglutination test for identification and confirmation of E. coli O157:H7. The antimicrobial susceptibility profile of the isolated E. coli O157:H7 was performed using the Kirby-Bauer disk diffusion method. The study revealed 1.5% (95% Confidence interval [CI]: 0.4–3.8%) of the collected raw milk was contaminated with E. coli O157:H7. The isolates showed 100% susceptibility to azithromycin, norfloxacin, nitrofurantoin, amikacin, chloramphenicol, tetracycline, and trimethoprim-sulfamethoxazole. In contrast, the isolates showed 75% and 100% resistance to ampicillin and cefotaxime, respectively. In conclusion, the consumption of raw milk may constitute a public health hazard due to contamination with E. coli O157:H7. Farmers and farmworkers should be trained on milk hygiene and proper milk handling practices.