Land use/cover (LULC) change is one of the most important environmental phenomena that have affected the earths’ systems and its ecosystem services. Hence, this study was conducted with the main objective of assessing LULC change, its drivers andimpactson ecosystem services in Jimma Rare district for the year 1974–2019. In order to understand the spatial and temporal changes of LULC and its drivers four satellite images for the year1974, 1991, 2005 and 2019 were obtained and respondent interviews, focus group discussions (FGD) and field observations were employed. Moreover, the ecosystem service value coefficients developed at a global level were used to assess the impacts of LULC on ecosystem service provision of the study area. The results of the study revealed that grass land and forest land decreased from 4518.87ha (13.09%) to 902.42ha (2.61%) and 3287.79ha (9.52%) to 2506.63ha (7.26%) from 1974-2019 respectively. Similarly, wetland declined from1182.08ha (3.42%) to 562.37ha (1.63%) in the stated period.The greatest expansion of cultivated land and settlement area occurred during the year 1974-1991. Agricultural expansion, deforestation, overgrazing and expansion of rural and urban settlement were among the major proximate causes. Likewise, the major underlying drivers of LULC dynamics include population increase, the presence of weak policy and institutions, poverty and lack of awareness were identified by respondents and focus group discussants. The total natural capital value reduced from 662.75 (million $/ha/yr) to 577.03 (million $/ha/yr) in the study period indicating the impacts of LULC on ecosystem services. From this study, it is possible to conclude that Jimma Rare District has experienced a significant change in LULC and ecosystem service values over the past 45 years. Hence, appropriate policy packages of land use are required to curb the negative impacts of such changes in the study district in the provision of the required services for sustainable development.