The environmental impact of trace metal contamination is a concern for Lake Small Abaya, Ethiopia, because of nearby agricultural and industrial activities. This study assessed the levels of trace metals (Pb, Zn, Cd, Cu, Fe, Mn, and Cr) in water, sediment, and fish samples, as well as the physicochemical parameters of the water. Samples were collected from five sites and analyzed via graphite furnace atomic absorption spectrometry (GFAAS). The mean concentrations in the water were Zn: 0.6971 mg/l, Fe: 0.5628 mg/l, Cu: 0.1168 mg/l, Mn: 0.2129 mg/l, Pb: 0.0057 mg/l, Cr: 0.0021 mg/l, and Cd: 0.0014 mg/l. In the sediments, the mean concentrations were as follows: Fe, 33.066 mg/kg; Zn, 18.263 mg/kg; Mn, 22.777 mg/kg; Cu, 7.5663 mg/kg; Pb, 0.0751 mg/kg; Cr, 0.0233 mg/kg; and Cd, 0.0183 mg/kg. The fish samples presented mean concentrations of Fe: 21.855 mg/kg, Zn: 12.686 mg/kg, Cu: 0.3185 mg/kg, Mn: 0.9181 mg/kg, Pb: 0.0089 mg/kg, Cd: 0.0075 mg/kg, and Cr: 0.0015 mg/kg. All the metal concentrations were generally below the World Health Organization (WHO) regulatory limits. The physicochemical parameters indicated slightly alkaline to neutral conditions, with electrical conductivity and total dissolved solids within acceptable ranges. These findings suggest that current agricultural and industrial activities do not significantly contribute to trace metal pollution. However, continued monitoring and pollution control measures are recommended to ensure the long-term health and sustainability of the lake. This study highlights the importance of effective environmental management strategies to safeguard this crucial aquatic resource.