This article computed the food insecurity gap, severity of food insecurity and examined factors contributing to food insecurity in Nekemte town. Data was collected from 380 households selected randomly. Using the calories intake method the Foster, Greer and Thorbeck (FGT) index revealed that 56% of the households were unable to meet the daily recommended calories with an index of 0.11 for food insecurity gap. The logistic regression result confirmed that tenure security, less diversity of household livelihood, low access to entrepreneurship skill; household dependency ratio, less access to financial services and the types of livelihood pursued were the major determinant of food insecurity. The implication is that the municipality as well as development actors need to tailor their intervention to address these causes