Although several studies have been conducted on COVID-19 knowledge, attitude and prevention practices among healthcare workers and the general population, there has not been any study among taxi drivers in Ethiopia, including Dessie City and Kombolcha Town, the lack of which hinders providing evidence-based interventions to this target group. Thus, this study was designed to contribute to proper planning of COVID-19 intervention measures among taxi drivers in Dessie City and Kombolcha Town, Ethiopia. A cross-sectional study was conducted among 417 taxi drivers in Dessie City and Kombolcha Town during July to August, 2020. The data was collected using a structured questionnaire and an observational checklist. The collected data was checked, coded and entered to EpiData version 4.6 and exported to Statistical Package for the Social Sciences (SPSS) version 25.0 for data cleaning and analysis. The outcome variables of this study were good or poor knowledge, positive or negative attitude and good or poor frequent hand hygiene practices towards COVID-19. Bivariate (Crude Odds Ratio [COR]) and multivariable (Adjusted Odds Ratio [AOR]) logistic regression analysis were employed to identify factors significantly associated with good knowledge, positive attitude and good frequent hand hygiene practices among taxi drivers. Significance level of variables was declared at a p < 0.05 from the adjusted analysis. Out of the total 417 taxi drivers, 69.8% [95% CI: 65.2-73.9], 67.6% [95%CI: 63.1-72.2] and 66.4% [95% CI: 62.1-71.0] of the drivers had good knowledge, positive attitude and good frequent hand hygiene practices, respectively. Educational level (AOR = 7.55, 95% CI = 4.55-12.54), place of residence (AOR = 5.41, 95% CI = 1.4-20.08) and attitude towards COVID-19 prevention (AOR = 1.67, 95% CI = 1.02-2.74) were factors associated with good knowledge about COVID-19. Further, age of taxi drivers greater than 30 years (AOR = 3.01, 95% CI = 1.76-5.13), educational level of secondary or above (AOR = 3.16, 95% CI = 1.88-5.31), income (AOR = 3.36, 95% CI = 1.48-7.61), and knowledge about COVID-19 (AOR = 2.1, 95% CI = 1.21-3.54) were factors associated with positive attitude towards COVID-19 prevention. In addition, attitude towards COVID-19 (AOR = 5.5, 95% CI = 3.40-8.88) and educational level (AOR = 1.84, 95% CI = 1.15-2.95) were the factors associated with good frequent hand hygiene practices. We concluded that the rates of good knowledge, positive attitude and good frequent hand hygiene practices were relatively low among taxi drivers in Dessie City and Kombolcha Town. We strongly recommended providing training about COVID-19 prevention measures for taxi drivers that considers age, education status and attitude areas essential to improve their knowledge, attitude and frequent hand hygiene practices to prevent the spread of COVID-19.