This article sheds light on the impacts and dynamics of the latest decentralization phase in Ethiopia, which seeks to professionalize and democratize local government. Based on recent field research in Oromiya Region, we draw attention to the paradoxes inherent in the top-down decentralization of public administration within an authoritarian one-party state. On the one hand, decentralization in Oromiya has empowered kebele administrations and facilitated the expansion of service delivery into rural hinterlands. In particular the sub-kebele state and party structure is instrumentalized by local governments to mobilize and control households. On the other hand, state authority remains limited as peasants resist and subvert state-led development works and kebele officials must rely on clientelistic networks to implement policies. Consequently, decentralization and kebele reform in post-1991 Ethiopia have so far neither altered the tradition of hierarchical state–society relations nor improved the lack of genuine representative democracy at kebele level.