Background Globally, at least 1 billion people have a vision impairment that could have been easily prevented or easily treated. Cataract is the leading preventable and most treatable causes of blindness and bilateral low vision among adults. Despite being the leading cause of preventable and most treatable blindness, the lack of knowledge about the disease and its option of treatment is still a major barrier in reducing the blindness owing to cataract in the developing countries particularly in Ethiopia. Hence, the aim of this study is to determine the level of knowledge about cataract and associated factors among adults in Yirgalem Town, Sidama National Regional State, Southern Ethiopia, 2020. Methods A community-based cross-sectional study design was conducted among randomly selected 599 adult’s age 18 years and above from May 10–30, 2020. A multi-stage sampling technique was used to select the study participants. Data were collected using pre-tested and structured face-to-face interview questionnaires. The collected data were entered to Epi data version 3.1 and then exported to SPSS version 21 for analysis. Bi-variable and multivariable logistic regression was used to identify associated factors of knowledge about cataract. Adjusted Odds Ratio (AOR) together with 95% Confidence Interval (CI) was used to declare the statistical association between dependent and independent variables. Results Of the total study participants, 379 (64.7%), [(95% CI: 60.7–68.6%)] of them had good knowledge about cataract. Age (≥40 years) [AOR = 2.29(95% CI 1.18–4.44)], Elementary school completed [AOR = 2.31(95% CI 1.30–4.10)], High school & above [AOR = 5.55(95% CI 2.81–10.89)], governmental and non-governmental employed [AOR = 5.62 (95% CI 2.78–11.38)], Merchant [AOR = 1.72(95% CI 1.03–2.88)], Positive Attitude [AOR = 3.85(95% CI 2.94–6.47)] were positively significantly associated with knowledge about cataract. Whereas, rural residence [AOR = 0.19 (95% CI: 0.12–0.31)] was negatively associated with knowledge about cataract. Conclusions More than one third of the participants still had poor knowledge about cataract. This implies that health facilities should be engaged and raises the awareness of the community and empowers people about eye care needs.