Ethiopia is the second populous country in the sub Saharan Africa with the substantial share of Gross Domestic Product belongs to agricultural sector. Secondary time series data on different macroeconomic variables for the period 1993 to 2016 was used in this study with the aim of determining the factors influencing the agricultural output in Ethiopia. Descriptive statistics was employed for the computation of maximum and minimum values, means and standard deviation of the continuous variables. The co integration test was done by applying the Augmented Dickey Fuller and Phillips- Peron tests on the residual. The result of the test shows that explanatory variables and agricultural GDP are co integrated. Multiple linear regression model (MLRM) was employed to analyze the impact of explanatory macroeconomic variables on the agricultural output. From the result, agricultural land has a positive significant effect on agricultural output. External debt and annual growth in service and industrial output affects the agricultural GDP negatively and significantly. Even though structural transformation (growth in service and industrial output) is producing efficiency gains by reducing the agriculture's share of GDP, the need of improving agricultural productivity for reducing poverty and creating potential source of raw materials for the manufacturing sector is unquestionable. Hence, policy makers should set policies aimed at increasing agricultural production and the government effort in modernizing and commercializing the agricultural sector is pertinent.