This study was conducted to estimate the impact of land use/land cover (LULC) changes on the ecosystem service value (ESV) in the Upper Blue Nile basin over three-decade (1986–2020). The findings revealed that there is a decline in total ESV from US$ 492.77 × 106 in 1986 to US$ 400.65 × 106 for the year 2020. The ESV lost between 1986 and 2020 was about US$ 92.11 × 106. In terms of the individual ecosystem services, the contribution of all service values declined except food production and biological control. Among the major contributors of ESVs, food production, water regulation, erosion control, climate regulation, nutrient cycling, waste treatment, and water supply represent 89%, 88%, 86% in 1986, 2003, and 2020, respectively. Soil erosion and sediment transport under environmental pressure significantly contributed for the loss of ecosystem services (ES) in the sub-basin. In addition, FGD and KII ranked provisioning ecosystem services first in order of importance for communities in the study area. Therefore, it is important to pay attention to the sustainable conservation and restoration of natural resources through natural vegetation protection, enhanced vegetation cover, conservation practices and wetland management to enhance the natural capital and ecosystem services in the Muger Sub-basin.
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