Abstract Lake Tana Basin is located in upper Blue Nile Basin which is comprises a total area of 15,096 km2 of which 3063 km2 is covered by the Lake which is the source of Blue Nile river. Lake Tana Basin and Blue Nile River provide various benefits also for downstream countries. The basin is highly degraded by different natural and manmade problems and it influence both Ethiopia and downstream countries. The main cause of basin degradation is inappropriate LULC. Huge area of cultivated land using without suitable management is the major basin problem. It is due to insure food security coming from unprecedented population growth rate. Forested land has encouraged the infiltration capacity and permeability of the land. It helps to increase the recharge capacity contribute to base flow whereas it is vice versa for cultivated land which is quick overland flow and significant soil erosion have observed. Besides, the soil erosion from agricultural land is the main source of nutrient enters to the lake which is the cause for eutrophication. To combat such problems both up and downstream countries should discuss together and design and implement appropriate basin management strategies to sustain the biodiversity and hydrological system of the basin.