Vulnerability to the impacts of land degradation has been frequently reported in Ethiopia. However, the level of vulnerability and its determinants vary in spatial and temporal. The objective of this study was to estimate farm households' vulnerability to the impact of land degradation and its determinants in the Central Omo-Gibe river sub-basin, southwestern Ethiopia. Primary data were collected from 383 farm households using multistage random sampling techniques. The principal component analysis was employed to give different weights for indicators and estimate the households' vulnerability index so as to categorize farm households based on their level of vulnerability. The result showed that 44.91%, 39.16% and 15.93% of the sample farm households were found to be less, moderately and highly vulnerable to the impact of land degradation, respectively. The ordered logistic regression result showed that age, sex, marital status, family size, dependency ratio, extension service, social participation, livestock ownership, land tenure security, land size and distance to the nearest main road, perceived reduction cropland productivity and plot-level land degradation affected households' vulnerability to the impact of land degradation. Therefore, policymakers and local development practitioners should give priority to the highly vulnerable households focusing on the major factors affecting vulnerability strengthen human, financial, natural and physical including infrastructure and institutional capitals to minimize the impact of land degradation in the study area.