Youth identity formation in urban settings of Ethiopia is influenced by socio-economic conditions, cultural norms, and political dynamics. The study employed quantitative data collection methods including structured questionnaires administered to a stratified sample of young people across various urban centers in Ethiopia. Data analysis utilised descriptive statistics and thematic content analysis. Results indicated that approximately 60% of respondents identified political participation as important for their sense of identity, with themes emerging around traditional versus modern values influencing this perception. Youth in Ethiopian cities are increasingly politicized, particularly those from urban middle-class backgrounds who see politics as a means to assert their identity against dominant societal norms. However, they face significant barriers such as lack of awareness and access to political information. Educational programmes should be developed that incorporate civic education on the importance of youth participation in shaping urban identities and political landscapes.