An experiment was conducted on the determination of effective spatial arrangement for intercropping of maize and potato using competition indices at South Wollo, Ethiopia for two consecutive years, 2010-2011. The objective of the study was to determine effective spatial arrangement for intercropping of maize and potato. The treatments were 1 maize:1 potato, 2 maize:2 potato, 1 maize:2 potato (a), 2 maize:1 potato (a), 1 maize:2 potato (b) and 2 maize:1 potato (b). Sole maize and sole potato was used for comparison. JMP 5 (SAS) software's were used to compute the analysis of variance. The combined yield advantages in terms of total land equivalent ratio (LER) and Income equivalent ratio (IER) indices were greatest in the cases of 1 maize:1 potato followed by 1 maize:2 potato (b) intercropping arrangement. Area time equivalent ratio (ATER) values showed an advantage of 75.0% only in 1 maize:1 potato. Effective Monetary advantage (EMAI) index was highest in 1 maize:2 potato (b)followed by 1 maize: 1 potato intercropping arraignments. However, Competitive ratio (CR) values for all crops in all intercropping arrangements were less than one indicating both crops are equally competitive. Based on the this findings, 1 maize: 1 potato followed by 1 maize:2 potato (b) intercropping arrangement gave the highest PRY, LER,ATER, IER and EMAI; and lowest CR value and in turn achieve higher productivity rates of the two crops, which lead to favorably recommend the use and utilization of this system in south wollo. It is recommended that this project was conducted for two years, there was lack of budget and hence this research should be repeated in different agro ecology and spatial arrangement.