Highland bamboo (Yushania alpina) plays an important role in various socioeconomic aspects in Ethiopia. However, these socioeconomic roles and the associated challenges have not been studied in Bibugn District of East Gojjam, Ethiopia. Therefore, this study was conducted to assess the socioeconomic importance of highland bamboo and the associated challenges for its expansion. For this study, four rural sub-districts were selected purposively. Both semi-structured questionnaires and key informant interviews were used for data collection. Statistical Package for Social Science (SPSS version 20) and excel 2016 were employed for the data analysis. The result indicated that there were 82 respondents who have got their own bamboo lots while the remaining 53 respondents did not have their own bamboo lots. The study also revealed that about 149 ha of land was covered by highland bamboo culm under the four sub-districts of the district. Highland bamboo in the study area has been used frequently for house construction, flooring, basket making, source of income and for other household utensils. Among challenges and constrains of highland bamboo expansion in the study area, the most frequent ones were; less market demand followed by land scarcity and eucalyptus expansion competing with bamboo expansion. Statistically, there were no significant difference (p>0.05) among sub-districts on the challenges on highland bamboo expansion. For enhancing the socioeconomic significance of Bamboo plant in the area, addressing the challenges through awareness creation, proper harvesting, processing, value addition and diversification of products is recommended.