Ethiopia is the second populous country in Africa while it is one of the Sub-Saharan Countries trapped by poverty. Her population is increasing at an average rate of 2.5%. Thus the objective of this study to examine whether population growth has its own bad effects on the Ethiopian economy. Population may be considered a major factor for the abject poverty trap of the country in the period 1970/71-1990/91 since per capita income was very low. Although there has been registered improvement of economic performance since 2004/05, population growth has been still high even though the rate has been decreasing. Econometric analysis has shown that population growth has had a significant negative impact in the short run but that of positive impact in the long run on the economic performance of the country.