Working animals provide a critical socioeconomic role for many low‐income communities, especially in Ethiopia nearly all draft power for agriculture production is generated from working animals. However, the welfare status of working animals remains worst in the country. Hence, understanding the major welfare problems of working animals is the key to improve their welfare status and to maximize their economic contribution. This systematic literature review encompasses 28 studies published between 2010 and 2024 that address the role of working animals and the factors impinging on their welfare. In this review, PRISMA flow diagram was used for literature inclusion and exclusion. In this review, we provide the role of working animals on improving the livelihood of peoples. According to the review, working animals were used as a direct food source, served as draft power, as income source, and also used for other purposes. This review also indicates low treatment to disease and injury, poor access to feed and water, no freedom from beating and distress, low access to safe shelter, and no freedom to express normal behavior are the major welfare problems in Ethiopia. The review also finds the gaps in animal welfare measurement and data analysis method, which should be examined by future researchers.