Understanding the dynamics of land use/land cover (LU/LC) changes and what drives these changes is essential for creating effective strategies for sustainable land management. It also helps to monitor the impact on ecosystems and biodiversity, which is crucial for policy-making. This study focused on assessing the trends, rates, and extent of LU/LC change and its causes in the western part of Lake Abaya in Ethiopia. To achieve this, we used a supervised classification method with a maximum-likelihood algorithm to map different land use land cover types. Additionally, we gathered information through field observations, focus group discussions (FGDs), and key informant interviews (KIIs) to identify the factors driving LU/LC change and its consequences between 1990 and 2022. The study findings revealed that vegetation and wetlands significantly decreased over this period, while water bodies, agricultural land, and settlements expanded at the expense of other land uses. The average normalized difference vegetation index (NDVI) values decreased from 0.368 in 1990 to 0.135 in 2022, indicating declining vegetation health. Local communities point to several factors responsible for these changes, including the expansion of agricultural land, increased settlement, firewood collection, and charcoal production (as proximate/immediate drivers), as well as population growth, poverty, unemployment, climate change, and policy-related issues (as underlying causes). Thus, it needs the development and implementation of an integrated and sustainable land management system, and strong land use and restoration policies in order to halt or reduce the rapid expansion of agricultural land and settlement areas at the expense of vegetation and wetlands.