Background: Clinical depression has been associated with various chronic disease conditions. The chronic course of HIV, fostered by the use of antiretroviral therapy in infected patients, puts them at risk of developing clinical depression which unfortunately, is often undiagnosed and therefore untreated. This study aimed to assess Prevalence of unrecognized depression and associated factors among newly diagnosed people living with HIV/AIDS in west shoa zone, oromia regional state, central Ethiopia. Method: Institutional-based cross-sectional study was implemented in 2019. A total of 429 newly diagnosed HIV-positive patients who had regular visit at selected public health facilities in west shoa zone, oromia regional state, central Ethiopia were included in the study. Systematic random sampling technique was used to recruit study participants. Patient Health Questionnaire item nine (PHQ-9) was used to assess depressive symptoms. In addition to this, HIV perceived stress scale was used to assess HIV-related perceived stress. Result: A total of 429 study participants were included in the study, giving a response rate of 100%. The mean age of the respondents was 37 years (SD ± 10.04). This study revealed that 47.3% of HIV-positive patients had depression. Patients who had opportunity infection [AOR = 2.15, (95% CI 1.41, 3.29)], HIV-related perceived stress [AOR = 2.23, (95% CI 1.44, 3.46)] and CD4 cell count < 200 [AOR = 1.94, (95% CI 1.25, 3.02)] were more likely to have depression as compared to individuals who had no opportunity infection, no perceived HIV stress and CD4 cell count > 200, respectively.Conclusion and recommendation: Having HIV-related perceived stress and opportunity infection of participant had statistically significant association with undiagnosed depressive. Training of health workers in ART clinics and availing manuals on assessing mental health issues is useful to screen and treat depression among HIV patients.