Background Meconium is a green viscous fluid and its passage normally occurs within the first 24-48 hours after birth. However, fetuses could pass meconium before or during labor and mostly intrauterine passage was found to be associated with different feto-maternal stress factors resulting in increased risk of perinatal morbidity and mortality. In Ethiopia little is known about the proportion and associated factors for meconium stained amniotic fluid (MSAF). The aim of the study was to assess the proportion and associated factors of MSAF in women who came for labor and delivery service in a tertiary hospital in Ethiopia.Methods A cross sectional study was conducted from 1st June to 31 August, 2018 on 606 laboring mothers at Felege Hiwot Referral Hospital, northwest Ethiopia. Study participants were selected using a systematic random sampling technique. Data was collected using interviewer administered structured questionnaire. Data entry and analysis were made by using Epi-data v3.1 and SPSS v24, respectively. Both descriptive & analytical statistics were computed. Statistical significance was set at P < 0.05. Logistic regression was used to explore factors associated with MSAF.Results The proportion of MSAF was at 149 (24.6%) [95%CI: 21.3-28.2%]. Nonreassuring fetal heart rate pattern (AOR: 21.9,95% CI: 10.96-43.83), post term pregnancy (4.54,95% CI: 2.24-9.20), duration of labor more than 15 hours (AOR: 2.83,95% CI: 1.76-4.53), pregnancy induced hypertension (AOR: 2.43, 95% CI: 1.45-4.05), oligohydramnios (AOR: 2.53, 95% CI: 1.25-5.12) inter pregnancy interval less than 2 years (AOR: 2.24,95% CI: 1.12-4.51) and monthly family income less than 5000 Ethiopian Birr (185 United States Dollar) (AOR: 2.03, 95% CI:1.18-3.51) were significantly associated with MSAF.Conclusions The proportion of MSAF was at 24.6% which was higher than a previous study done in Ethiopia and elsewhere. Non-reassuring fetal heart rate pattern, post term pregnancy, duration of labor more than 15 hours, pregnancy induced hypertension, oligohydramnios, inter pregnancy interval less than 2 years and monthly family income less than 5000 Ethiopian Birr were factors associated with an increased risk for MSAF. Health professionals should assess laboring women for the presence of these factors and should stay alert to detect MSAF early and to act accordingly.