In Ethiopia, the predominance of informal employment is evident, with over 85% of the labor force involved, including a substantial percentage of informal wage earners. In informal employment, there are exploitative relationship between employers and employees. The purpose of this was to investigate the opportunities and challenges experienced by employees in informal employment in central region of Ethiopia. For the s cross-sectional survey, a sample employee was selected employing a combination of purposive and convenience sampling techniques.The study's data was analysed using descriptive statistics analysis and five-point Likert scale methods. The analysis reveals that a majority of informal employees are migrants from the rural area due to search of job, youth, single, and have low level of education. The study found that informal employees faced major challenges comprising low salary paid, high level of job insecurity, poor working condition absence of overtime and eaves pay, discrimination, lack of Social security contribution, and difficulty in joining labour unions.  The major opportunities of employees are escape from unemployment, development of Entrepreneurial skill, job flexibility, and contribution for local economy. The results emphasize the necessity of policy interventions to enhance working conditions and mitigate the socioeconomic challenges faced by employees in urban settings