In 2003 the Ethiopian education system experienced wide-ranging reform that touches every aspect of the system. This reform is called TESO (Teacher Education System Overhaul). Designed to address educational problems in Ethiopia, TESO introduced significant structural changes and promised to bring a 'paradigm shift' in the Ethiopian educational system by engaging teacher education in changing society and promoting democratic, practical, and problem-solving education. This paper examines, through an analysis of the TESO document and an examination of the views of teacher educators, TESO's assumptions, mission and the coherence among the various components of TESO. It also reveals gaps and discrepancies between TESO's mission, its reform process, and strategies. The promise and assumptions of TESO are challenged by considering extant realities in Ethiopian schools and evidence from literature on effective teacher education programs and educational reform. The paper reflects on how, by giving priority to equity, TESO compromises on some elements of effective teacher education programs. It is indicated that TESO has been a welcome addition to the Ethiopian education system as it addresses elements that had previously been missing from the system, such as, outlining directions to teacher education, devoting longer duration for practicum, and heeding seriously to the professional preparation of teachers. At the same time, it is contended that the imbalance among program components, its permeability to ill-prepared students and the contradiction between program rhetoric and strategy and reform processes, as described by teacher educators, could be stumbling blocks which prevent TESO from fulfilling its promises.