Environmental isotope (2H and
18O) techniques supported by hydrochemical surveying, water balance and conventional hydrogeological mapping were used to study the hydrogeological system of four major lakes located in a closed central Ethiopian rift basin. The focus of attention is the groundwater and surface water interaction and the subsurface hydraulic connection of the lakes. The result shows that despite their geographic proximity, the lakes have highly variable isotopic and hydrochemical signature owing to geological and geomorphological factors. Two of the lakes are alkaline and found to be terminal from both surface water and groundwater point of view. They are in the state of high evaporation with respect to present day precipitation. The groundwater flow converges from all sides of the basin and plays very important role in the water balance of all the lakes. Major flow system in the rift and the hydraulic connection of the lakes is strongly controlled by the direction and extent of the extensional normal faults.