||Because seed supply and cost strongly influence farmers' ability to increase wheat production, researchers undertook a survey to document how Ethiopian farmers in Wolmera woreda acquire, manage and transfer wheat seed. Wolmera woreda was selected for this study because it is typical of the central highlands, one of the most important wheat-growing areas of Ethiopia. A sample of 80 farmers, selected using a multistage sampling procedure, were surveyed using a structured questionnaire. A logit model was used to assess factors affecting adoption of improved wheat varieties. The analysis revealed several means of improving the dissemination of new wheat varieties. The slow rate of varietal replacement in the study area reflects problems with the seed industry and extension services. Radio was the main source of information about improved wheat varieties, and extension agents should use this medium in additional to demonstration and popularization programs, which also influenced the adoption of improved seed . Extension agents should focus on informing younger farmers about how to manage improved seed, given that farming experience was negatively associated with the use of improved wheat. The dissemination of improved varieties through farmer-to-farmer seed exchange indicated that there was demand for improved varieties, but the participation of the formal sector in distributing improved wheat seed is limited. Current changes in the seed industry, such as permission for private firms to participate, the creation of the National Seed Industry Agency, and strengthening of the national extension service, should improve this situation considerably. A clear seed policy would encourage private firms in the production and distribution of improved seed. Farmers themselves could participate in seed production and distribution. Policies and institutional and legal frameworks should be develop to link the formal and informal seed sectors so they can work in a complementary fashion.