Though Ethiopia is one of the least urbanized countries of the world, its urban areas are expanding rapidly. Woldia, which is a Zonal town is no exception to this trend and situation. As a result of its rapid horizontal expansion and growth, Woldia is currently confronted with different types of urban problems. The emergence and growth of informal settlements is one of these challenges. To that end, this paper investigates the foremost demographic and socio-economic triggering factors that played key roles for the growth of informal settlements at the peri-urban areas of Woldia. In order to achieve the objective of the study, a questionnaire survey covering a total of 244 sample households was carried out in addition to in-depth interviews, FGDs and key informants. Accordingly, the income disparity; the rise in the lease price of urban land, and the meager compensation paid to peri-urban farmers during their lands expropriation are among the key economic drivers for the growth of informal settlements. Similarly, ever-increasing urban population and inefficient land provision, and lack of housing affordability compounded by the rise in the rental accommodation are the other triggers factors. All these factors, among others, point to the fact that socio-economic and demographic factors are all tied to the immediate growth of such settlements. Thus, lands at the periphery are misused and the situation has greatly contributed to the unlawful and rapid expansion of built-up areas in the city administration.
