BACKGROUND: There has been recent large scale-up of malaria control interventions in Ethiopia where transmission is unstable. While household ownership of long-lasting insecticidal nets (LLIN) has increased greatly, there are concerns about inadequate net use. This study aimed to investigate factors associated with net use at two time points, before and after mass distribution of nets. METHODS: Two cross sectional surveys were carried out in 2006 and 2007 in Amhara, Oromia and SNNP regions. The latter was a sub-sample of the national Malaria Indicator Survey (MIS 3R). Each survey wave used multi-stage cluster random sampling with 25 households per cluster (224 clusters with 5,730 households in Baseline 2006 and 245 clusters with 5,910 households in MIS 3R 2007). Net ownership was assessed by visual inspection while net utilization was reported as use of the net the previous night. This net level analysis was restricted to households owning at least one net of any type. Logistic regression models of association between net use and explanatory variables including net type, age, condition, cost and other household characteristics were undertaken using generalized linear latent and mixed models (GLLAMM). RESULTS: A total of 3,784 nets in 2,430 households were included in the baseline 2006 analysis while the MIS 3R 2007 analysis comprised 5,413 nets in 3,328 households. The proportion of nets used the previous night decreased from 85.1% to 56.0% between baseline 2006 and MIS 3R 2007, respectively. Factors independently associated with increased proportion of nets used were: LLIN net type (at baseline 2006); indoor residual spraying (at MIS 3R 2007); and increasing wealth index at both surveys. At both baseline 2006 and MIS 3R 2007, reduced proportion of nets used was independently associated with increasing net age, increasing damage of nets, increasing household net density, and increasing altitude (>2,000 m). CONCLUSION: This study identified modifiable factors affecting use of nets that were consistent across both surveys. While net replacement remains important, the findings suggest that: more education about use and care of nets; making nets more resistant to damage; and encouraging net mending are likely to maximize the huge investment in scale up of net ownership by ensuring they are used. Without this step, the widespread benefits of LLIN cannot be realized.