Cross sectional study was conducted in Addis Ababa city of Ethiopia to assess the major constraints and opportunities of dairy production in selected dairy farms of Addis Ababa namely Bole, Kolfe and Yeka sub cities. During the assessment a total of 118 dairy farms categorized under small and medium scale farms were visited. For data gathering structured and semi-structured questionnaire survey with a simple sampling technique was used. The data were analysed using SPSS version 20, and the results were presented using descriptive statistics. Based on the result of this study, the opportunities for the dairy farmers are market access (83.1%), access to veterinary services (84%), access to artificial insemination service (76.1%) and waste management in which 61% and 39% is used as a source of fuel and fertilizer, respectively. On the other hand, the constraints for the dairy farmers are lack of credit access (10.9%), shortage of labour (60%), lack of farming land (80%), feed shortage (50%) and lack of water supply (79.4%). Regarding the occurrence of diseases affecting the dairy farms the major diseases in the present finding were mastitis 38.3%, Bloat 25.4%, Milk fever 19.3%, parasitic disease 7.5% and foot and mouth disease 2.5%. In addition, the major reproductive disorders in the study areas were assessed and the study revealed that; 55% of respondents do not clearly understand the cause of the disease where as abortion; dystocia, retained fetal membrane and vaginal and uterine prolapse were reported by 12%, 6.8%, 4.1% and 4.9% of the interview respectively. The sector is hindered by significant constraints such as health and reproductive issues, labour shortages, inadequate feed and water supply, and insufficient farmland for production. Therefore, any development interventions targeting improved dairy cattle productivity and the livelihoods of dairy farmers should be carefully planned and effectively implemented.