BACKGROUND: Khat (Catha edulis) contains a psychoactive substance, cathinone, which produces central nervous system stimulation analogous to amphetamine. It is believed that khat chewing has a negative impact on the physical and mental health of individuals as well as the socioeconomic condition of the family and the society at large. There is lack of community based studies regarding the link between khat use and poor mental health. The objective of this study was to evaluate the association between khat use and mental distress and to determine the prevalence of mental distress and khat use in Jimma City. METHODS: A cross-sectional community-based study was conducted in Jimma City from October 15 to November 15, 2009. The study used a structured questionnaire and Self Reporting Questionnaire-20 designed by WHO and which has been translated into Amharic and validated in Ethiopia. By multi stage sampling, 1200 individuals were included in the study. Data analysis was done using SPSS for window version 13. RESULTS: The Khat use prevalence was found to be 37.8% during the study period. Majority of the khat users were males (73.5%), age group 18-24 (41.1%), Muslims (46.6%), Oromo Ethnic group (47.2%), single (51.4%), high school students (46.8%) and employed (80%). Using cut-off point 7 out of 20 on the Self Reporting Questionnaire-20, 25.8% of the study population was found to have mental distress. Males (26.6%), persons older than 55 years (36.4%), Orthodox Christians (28.4%), Kefficho Ethnic groups (36.4%), widowed (44.8%), illiterates (43.8%) and farmers (40.0%) had higher rates of mental distress. We found that mental distress and khat use have significant association (34.7% Vs 20.5%, P