This study was conducted to explore bird species diversity and conservation challenges in Lake Arekit located in the Guraghe Zone of Ethiopia. Point counts along the shoreline of the lake were employed to identify and record birds. Potential threats to the lake were identified through field observation and via key informant interviews. A total number of 56 bird species belonging to 23 families, and 11 orders were observed. One species, the Blue winged Goose (Cyanochen cyanoptera) was endemic, three species were near-endemic, and five species were vulnerable in their conservation status. A significantly higher number of species (i.e., 47) was recorded in the dry season than in the wet season (i.e., 24). The relative abundance of birds was also significantly higher during the dry season (t = 2.23, P > 0.05). The study also showed that Lake Arekit is under severe threats including urbanization with unwise waste disposals, siltation, and intensive agricultural expansion. Therefore, urgent stakeholder actions are required to save this lake and thereby the vast array of its biodiversity particularly the birds.