Tef [<i>Eragrostis tef (Zucc.) Trotter </i>L.] is a most important cereal crop in Ethiopia in terms of production, consumption and cash. The study was carried out to investigate grain yield stability and genotype by environment interaction for 18 genotypes conducted in the potential high land areas of Western Oromia, Ethiopia for two consecutive years (2020 to 2021) using Randomized Complete Block Experimental Design with three replications. The study of variance for grain yield using the AMMI model indicated highly significant variation for genotypes, environment, and genotype-environment interactions. Environment accounted for 18.7% of the variance in grain yield, 17.9% for genotypes, and 61.5% for genotypes. The first IPCA component accounted for 47.9% of the interaction effect and revealed the two models were fit. Genotypes G15, G10, G4, G1, and G3 had the lowest AMMI stability value (ASV), indicating stability; genotypes G16, G14, G9, G7, G2, and G5 had the highest ASV value, indicating instability. From over all analysis genotype G1 and G3, showed a high mean grain yield, lowest GSI, ASV and stable compared to other genotypes in the study. As a result, G1 and G3 were identified as the best genotypes for future breeding programs and potential release in Western Oromia, Ethiopia's highlands.