Wheat stem rust samples were collected in 2006 and 2007 in the Arsi, Bale, Shewa and northwest regions of Ethiopia to determine virulence diversity and race distribution in Puccinia graminis f.sp. tritici populations. Stem rust incidence was high in Arsi, Bale and east Shewa. In northwest Ethiopia, and north and west Shewa, stem rust was prevalent at low levels. A total of 152 isolates was analysed and 22 races were identified. Races TTKSR (Ug99), TTHSR and RRTTR were predominant, with frequencies of 26·6, 17·7 and 11·1%, respectively. These races were also detected in all regions. The highly virulent race designated Ug99 was present throughout the country and dominated in all regions except northwest Ethiopia. A variant of Ug99 virulent against the stem rust resistance gene Sr24 was not detected in this study. Four stem rust resistance genes (Sr13, Sr30, Sr36 and SrTmp) were found to confer resistance to most of the races prevalent in Ethiopia. With the exception of Sr30, which is not effective against Ug99, these genes could be used in breeding for resistance to stem rust in Ethiopia.