In many developing countries solid waste is not collected and disposed properly, leading to public health risks for example due to water contamination. This manuscript evaluates type of Private Sector Involvement (PSI) and the regulatory contractual arrangements for Solid Waste Collection (SWC) in the five most populated Ethiopian cities. The study assesses whether these arrangements lead to sustainable SWC. Data was collected using a structured questionnaire administered to private companies in the city of Addis Ababa, Mekelle, Hawasa, Adama and Bahir Dar. We also interviewed and organized Focus Group Discussions (FGD) with local government and municipal officials, private company managers, and SMEs members. We find that the Ethiopian constitution, policies, proclamations and strategic documents for SWC clearly state the need for an integrated approach for sustainable SWC. Yet, the lack of transparency and independence of Cleaning Administration Agency (CAA) and Cleaning Administration Department (CAD) are impediments to enforce the contractual agreement and achieve sustainable SWC. The intervention of city officials, and poor financial and human resource capacity of CAA and CADs, lack of commitment to adhere contractual obligations, and the less concern of the private companies and the people towards waste handling are existing challenges. The Ethiopian government needs to improve the governing capacity of the CAA and CADs. Besides, it should commit a full scale implementation of sustainable SWM principles. Otherwise, unnecessary loss of resources and overwhelming adverse impact on the environment and on the Ethiopian public health and safety will persist prevailing.