Abstract. Land degradation due to lack of sustainable land management practices is one of the critical challenges in many developing countries including Ethiopia. This study explored the major determinants of farm-level tree-planting decisions as a land management strategy in a typical farming and degraded landscape of the Modjo watershed, Ethiopia. The main data were generated from household surveys and analysed using descriptive statistics and a binary logistic regression model. The model significantly predicted farmers' tree-planting decisions (χ² =  37.29, df  =  15, P < 0.001). Besides, the computed significant value of the model revealed that all the considered predictor variables jointly influenced the farmers' decisions to plant trees as a land management strategy. The findings of the study demonstrated that the adoption of tree-growing decisions by local land users was a function of a wide range of biophysical, institutional, socioeconomic and household-level factors. In this regard, the likelihood of household size, productive labour force availability, the disparity of schooling age, level of perception of the process of deforestation and the current land tenure system had a critical influence on tree-growing investment decisions in the study watershed. Eventually, the processes of land-use conversion and land degradation were serious, which in turn have had adverse effects on agricultural productivity, local food security and poverty trap nexus. Hence, the study recommended that devising and implementing sustainable land management policy options would enhance ecological restoration and livelihood sustainability in the study watershed.