This study set-out to examine how university-industry linkage (UIL) is managed in government universities of Ethiopia to contribute to the economic development of the country. Basic questions related to the level of management of UIL, areas of linkage, benefits obtained so far from this partnership, challenges to the proper management of UIL, and the existing opportunities for promoting UIL were raised. In addition to this, strategies for strengthening UIL were also dealt with. In relation to this, the study was framed with the system theory viewpoints and human capital theory viewing universities as a system linked to its external environment like industries. As a model, interactive/balanced type of Triple Helix model was used as it integrates the activities of the government, universities and the industries. Moreover, this study reviewed global perspectives on UIL and an overview of the study context with greater emphasis on higher education reforms and proclamations. Philosophically, this study followed pragmatism research paradigm using mixed research approach. It also employed concurrent/parallel/convergent design in which both quantitative and qualitative data were collected simultaneously, interpreted separately and combined at the time of discussion for better understanding of the problem. Equal importance for both data sets was given. Data were gathered from 99 college deans and department heads, 200 instructors and 316 prospective graduates. In addition to this, 23 interviewees from UILOs, industries, MoE, and MoST took part in this study. Moreover, two focus group discussions were also conducted with the university alumni and data were gathered through survey questionnaires, semi-structured interview, FGD question guides and document reviews. The study result indicated that both quantitative and qualitative data support one another. It was found out that UIL was at its infant stage of development in government universities of Ethiopia with limited areas, dominated by students’ internship. Ethiopian government universities have a link with the industries in areas of some limited joint research projects, consultancies and capacity building. Consequently, universities benefitted by attaching their students with the industries and students got practical exposure to the real world of work. Industries also benefitted from the training provided to them, consultancies and joint research projects. On the other hand, UIL in government universities of Ethiopia was challenged by institutional bottlenecks, policy-practice gaps, contextual variation and information gaps, finance and awareness related caveats, work overload, and facility related hurdles. Moreover, lack of trust and commitment between U & I, lack of commitment and support from the leadership of both universities and industries, and the reluctance of the local industries to work with the universities remained a big rift to UIL. This study also sheds light on the expansion of universities and industries in different parts of the country as the opportunities to be tapped to promote UIL. Further, the attention of the government by designing different policies, strategies, directives and conferences was taken as the opportunity. As a major contribution, this study came up with the model that was designed to improve the practice of management of UIL in government universities of Ethiopia. To overcome the above challenges and to make use of existing opportunities, it was recommended that improving leadership and management related challenges through joint planning, organising, staffing and decision-making. Moreover, it was highly laudable to make a paradigm shift in the roles of universities from teaching dominated to research and innovation universities. Finally, bridging policy-practice gaps, increase networking, arranging various sensitising and advertising programmes and creating a further avenue for more research were commented. / Educational Leadership and Management / D. Ed. (Education Management)