The aim of this research study was to investigate students’ and teachers’ perceptions, challenges and practices of using English as sole medium of instruction. More specifically it was intended to examine the perceptions of teachers and students towards using English as a sole medium of instruction in public universities in North Western Ethiopia, to investigate factors that affect teachers and students not to use English as medium of instruction and to inspect the practices of English as medium of instruction in selected universities. To collect the required data, questionnaires, classroom observations and interviews were employed. By using these methods of data collection, the following findings were obtained.In the study universities, there were students perceived that code switching was necessary in bilingual classes. However, there were many students who perceived negatively teachers’ code switching in bilingual classes. These different perceptions were based on their ability of communicating in Amharic language. In addition, teachers perceived that student related difficulties and challenges affected teachers not to use English as a medium of instruction. Furthermore, the practice of using English as a medium of instruction within the classroom is not significantly maximized. Students’ difficulty and related factors influenced negatively the practice of using English as a medium of instruction. Based on these findings, the following recommendations were made. Firstly, university teachers should understand that when they use Amharic language in the classroom whether or not all of the students able to communicate through this language. Next, instructors who are teaching in universities should maximize using English as a medium of instruction since students are from various Ethnical backgrounds. Finally, Ethiopian secondary schools should work more on students’ language competence like supporting English Language clubs and emphasizing language learning for communication etc to minimize student related factors in university.