Insomnia is a prevalent sleep disorder that affects people all over the world. Creating suitable interventions will require a better understanding of the magnitude and determinants of insomnia. This study aimed to assess the prevalence and associated factors of insomnia symptoms among residents of Mettu town during the pandemic lockdown. A community-based cross-sectional study was conducted among residents of Mettu town from October 1st to October 15th, 2020. Residents who lived in Mettu town at least for six months were included. To determine the prevalence and determinants of insomnia symptoms, both descriptive and inferential analyses were used. The chi-squared test of association and logistic regression was used to identify predictors of insomnia symptoms among residents of Mettu town. We used SPSS version 25 for all statistical analyses. The prevalence of depressive symptoms among residents of Mettu town was 52.6%. According to results of multivariable binary logistic regression, being female [AOR = 3.677, 95%CI: 2.124-6.365], being aged between 19 and 40 [AOR = 13.261, 95%CI: 6.953-25.291], being aged above 41 [AOR = 2.627, 95%CI: 1.120-6.159], smoking [AOR = 15.539, 95%CI: 7.961-30.329], satisfaction with information available [AOR = 0.310, 95%CI: 0.168-0.570], fear Corona Virus Disease 2019 (COVID-19), [AOR = 2.171, 95%CI: 1.262-3.733], feeling alienated from others [AOR = 3.288, 95%CI: 1.897-5.699], having somatic symptoms [AOR = 2.298, 95% CI: 1.360-3.884], having depressive symptoms [AOR = 1.841, 95% CI: 1.073-3.160], and experiencing psychological distress [AOR = 1.962, 95% CI: 1.173-3.281] were significantly associated with insomnia symptoms. In this study, the prevalence of insomnia symptoms was found to be high among residents of Mettu town. Being female, being aged between 19 and 40, being aged above 41 years, smoking, fear of Corona Virus Disease 2019, feeling alienated from others, having somatic symptoms, having depressive symptoms, and experiencing psychological distress were all associated with an increased risk of developing insomnia symptoms while being satisfied with the information available decreased the risk of insomnia symptoms among residents of Mettu town. Interventions should be put in place to promote healthy sleep among residents of Mettu town.