BackgroundIn Ethiopia, child undernutrition remains to be a major public health challenge and a contributing factor for child mortality and morbidity. To reduce the problem, it is apparent to identify determinants of child undernutrition in specific contexts to deliver appropriately, targeted, effective and sustainable interventions.MethodsAn agroecosystem linked cross-sectional survey was conducted in 3108 children aged 6–59 months. Multistage cluster sampling technique was used to select study participants. Data were collected on socio-demographic characteristics, child anthropometry and on potential immediate, underlying and basic individual and community level determinants of child undernutrition using the UNICEF conceptual framework. Analysis was done using STATA 13 after checking for basic assumptions of linear regression. Important variables were selected and individual and community level determinants of child height-for-age Z score were identified. P values less than 0.05 were considered the statistical level of significance.ResultsIn the intercept only model and full models, 3.8% (p < 0.001) and 1.4% (p < 0.001) of the variability were due to cluster level variability. From individual level factors, child age in months, child sex, number of under five children, immunization status, breast feeding initiation time, mother nutritional status, diarrheal morbidity, household level water treatment and household dietary diversity were significant determinants of child height for age Z score. Also from community level determinants, agroecosystem type, liquid waste disposal practice and latrine utilization were significantly associated with child height-for-age Z score.ConclusionIn this study, a statistical significant heterogeneity of child height-for-age Z score was observed among clusters even after controlling for potential confounders. Both individual and community level factors, including the agroecosystem characteristics had a significant role in determining child height-for-age Z score in the study area. In addition to the existing efforts at the individual levels to improve child nutritional status, agroecosystem and community WASH related interventions should get more attention to improve child nutritional status in the study area.