A cross-sectional study was conducted from November 2008 to March 2009 to estimate the prevalence of lungworm infection and to investigate some of the risk factors associated with small ruminant lungworm infections in Dessie and Kombolcha districts, northeastern Ethiopia. Faecal samples were collected from randomly selected 404 animals (240 sheep and 164 goats) to examine first stage larvae (L(1)) using modified Baerman technique. One hundred and thirty eight animals (113 sheep and 25 goats) were also subjected to postmortem examination to detect the presence of adult lungworm parasites. The overall prevalence recorded by faecal and postmortem examinations were 36.9% and 62.3%, respectively. Prevalence of lungworm infection was significantly higher (OR=2.1, 95% CI=1.2, 3.5) in sheep (40.4%) than in goats (31.7%). The proportions of infection by Dictyocaulus filaria (D. filaria), Mullerius capillaris (M. capillaris) and mixed infection were 1.3% (3/240), 28.3% (68/240) and 10.8% (26/240) in sheep; and 20.1% (33/164) by M. capillaris and 11.6% (19/164) with mixed infection in goats. Animals above one year (OR=8.7, 95% CI=4.8, 15.6), non-dewormed animals (OR=10.4, 95% CI=5.6, 19.3) and those sampled during November (OR=3.6, 95% CI=1.5, 8.6) had higher odds of infection prevalence than animals in corresponding groups. The mean count of L(1) larvae of D. filaria and M. capillaris were 5.4 (95% CI=3.6, 7.3) and 39.3 (95% CI=33.7, 44.9) in ovine and 4.5 (95% CI=3.1, 5.8) and 34.1 (95% CI=27.2, 41.1) in caprine, respectively. The recorded average larval count of the two parasitic species varied significantly in both sheep and goats. This study showed high prevalence of lungworm infections which impairs the productivity of small ruminants, implying the need for control intervention.