Abstract: A survey study was conducted on 142 and 60 apparently healthy slaughtered sheep and goats, respectively, at an export abattoir, Modjo, Ethiopia from October 2007 to April 2008. The objectives were to determine prevalence of Salmonella in slaughtered sheep and goats and abattoir environment investigate the potential risk factors and Salmonella contamination rates of carcasses. A total of 1,240 samples consisting of skin swabs, eviscerator’s hand swabs, eviscerating knife swabs, mesenteric lymph nodes, cecal contents, carcass swabs and water samples were collected. The samples were examined for the presence of Salmonella following standard techniques and procedures outlined by the International Organization for Standardization. From the total of 202 animals examined for Salmonella, 18 (8.9%) were positive, of which 11 (7.7%) were sheep and 7 (11.7%) were goats. In a total of 1,240 different samples, Salmonella was isolated in 89 (7.2%) samples of which 25 (12.4%) were carcass swabs, 11 (5.5%) mesenteric lymph nodes, 8 (4.0%) cecal contents, 10 (5.0%) skin swabs, 18 (8.9%) eviscerator’s hand swabs, 15 (7.4%) eviscerating knife swabs and 2 (7.1%) water samples. Salmonellae were detected in all test samples obtained from sheep and goats. Although, no statistically significant results were observed except with eviscerating knife swab which was found to be significantly associated with carcass contamination. Sheep and goat carcasses that were eviscerated using Salmonella positive knives were 4.175 times more likely to be contaminated with Salmonella compared to those that were eviscerated with Salmonella negative knives. Therefore, proper sterilization of knives at 82°C should be implemented at abattoirs to reduce contamination of the meat and other edible offals during slaughtering operations.