This article chronicles the key challenges facing Ethiopia as it embarks on an ambitious, ideologically-driven and aggressive expansion of its higher education system in an effort to address its national goals of economic growth and poverty reduction. It is argued that the urge for higher education expansion has placed undue pressures particularly on the state of quality enhancement and autonomy of universities. As government pressures for more expansion mounted, universities struggled with dwindling per student budgetary allocations, shortage of qualified staff, inadequate supply of much needed inputs and the erosion of their autonomy. It is suggested that while higher education expansion remains an important goal for Ethiopia for many years to come, a reasonable balance should be struck between the ideological aspects of expansion and the practical realities of limited resources, heightened concerns about the quality of student learning and the autonomy of universities.