Background Post-stroke depression (PSD) is the most common neuropsychiatric complication following stroke. Although its prevalence varies across studies and meta-analyses, it is estimated to affect over 25% of stroke survivors. Despite its significant negative impact on recovery and quality of life, PSD is frequently underdiagnosed, misinterpreted as a stroke-related symptom, and often left untreated. Although multiple studies have been conducted in high-income countries, research on PSD remains limited in Ethiopia, especially in the southern region. Methods An institution-based prospective cross-sectional study was conducted from June to December 2024 on 216 stroke patients attending follow-up at the neurology clinic. Data were collected using a standardized questionnaire and review of patient records, facilitated by Kobo Toolbox. The data were then cleaned and analyzed using SPSS Version 27. Binary logistic regression was employed to identify factors associated with PSD. A p-value < 0.05 with a 95% confidence interval (CI) was considered statistically significant. Results In the bivariable analysis, age, marital status, duration since stroke, physical disability, diabetes mellitus, renal failure, cardiac illness, presence of multiple comorbidities, and khat (Catha edulis) chewing were associated with PSD (p < 0.25). In the multivariable analysis, 6-12 months post-stroke (adjusted odds ration [AOR]: 0.07; 95% CI: 0.02-0.21), more than 12 months post-stroke (AOR: 0.02; 95% CI: 0.01-0.08), presence of physical disability (AOR: 5.27; 95% CI: 1.85-15.0), and cardiac illness (AOR: 5.05; 95% CI: 1.36-18.7) were significantly associated with PSD (p < 0.05). Conclusion This study identified physical disability, cardiac illness, and shorter duration since stroke as significant predictors of PSD. Approximately one in three stroke survivors were affected by PSD. The findings underscore the need for early detection, routine screening, and integration of mental health care into stroke rehabilitation programs. Identifying and addressing modifiable risk factors is crucial in reducing the burden of PSD and improving patient outcomes.