Academic Paper from the year 2016 in the subject Sociology - Individual, Groups, Society, Ethiopian Civil Service University (federalism and legal studies), course: Federalism and Human Rights, language: English, abstract: The existing ethnic federal arrangement of the Federal democratic republic of Ethiopia (FDRE) is devised with the aim to accommodate the interests of distinct ethnic groups in Ethiopia. This paper attempted to conceptualize federalism as a tool for ethnic diversity accommodation through reviewing the existing literature on federalism, FDRE and south regional state constitution, city proclamations, and primary data from interview made and with researchers¿ interpretive arguments. The finding reveals that federalism at city government status contributes to accommodate rights, interests, needs and claims of competing ethnic groups, especially of ethnic minorities better at kebele institutional structures than at city institutional structures. At city institutional structures the indigenous groups are better protected rather than the non indigenous groups. Hence, the success of this process highly depends on the mechanisms adopted for sharing powers and responsibilities; the nature, subject and degree of decentralized power; and the willingness of authorities to allow the groups to exercise those powers, with other factors. Finally, This Paper tries to recommend complementary legal instrument for farther enhancement of ethnic diversity accommodation at city government status.