BackgroundDemand-side barriers are as important as supply factors in deterring patients from obtaining treatment. Developing countries including Ethiopia have been focusing on promoting health care utilization as an important policy to improve health outcomes and to meet international obligations to make health services broadly accessible. However, many policy and research initiatives focused on improving physical access rather than focusing on the pattern of health care service utilization related to demand side. Understanding of determinants of demand for health care services would enable to introduce and implement appropriate incentive schemes to encourage better utilization of health care services in the community of Tsegedie district, Northern Ethiopia.MethodsA community based cross sectional study design was conducted from March1–30/2016 in Northern Ethiopia. Systematic random sampling technique was used to select 423 participants from 2189 patients of the one-month census. A pretested and standardized semi-structured interviewer administered questionnaire was used to collect the data. The data were entered using Epi-info version 7 and analysed by STATA version 11. Multinomial logistic regression model was used to identify the determinants of demand for health care service.ResultsA total of 423 (with a response rate of 98.3%) study participants were included in the study. The finding indicates that 72.5% (95%CI = 61.6, 81.1) of the participants demanded modern health care services. The multinomial logistic regression econometric model revealed that perceived severity of illness (β = 1.27; 95% CI = 0.74, 1.82), being educated household head (β = 0.079; 95% CI = 0.96, 1.74), quality of treatment (β = 0.99; 95% CI = 0.47, 1.5), distance to health facility β = 1.96; 95%CI = 0.11, 0.27), cost of treatment (β = − 1.99; 95% CI = 0.85, 3,13) were significantly and statistically associated with demand for health care service.ConclusionThis study revealed that in Tsegedie district, majorities (72.5%) of the patients demanded modern health care service. Distance to health care facility, user-fees, educational status of household, quality of service, and severity of illness were found to be significantly associated with demand for health care service.Out of pocket, payments should be changed by prepayment schemes like community-based insurance than to depend on user fees and appropriate health information dissemination activities should strengthen to create awareness about modern care.