Background: The vulnerability of young people especially young females for many reproductive health problems made it important to assess the magnitude of premarital sexual practice and its consequences among young females. Objectives: To assess the magnitude of premarital sexual practice and its consequences among female students in Ambo University February 2012. Methods: A cross sectional study design was conducted among a randomly selected sample of Ambo University female students from January to February 2012 by using a self-administered questionnaire. Bivariate and a multiple logistic regression were employed to determine independent predictors of premarital sex and its consequences among female students. The quantitative data was supported by the qualitative data that were obtained from four Focus Group Discussions. Results A total of 650 female students were involved in the study yielding 167 (25.7%) of sexually active respondents with a mean age at first sexual debut to be 16.9±2.7 years. About 90(53.9%) of sexually active respondents reported they started sex after joining the University. Finding from both quantitative and qualitative study suggests that pre-marital sex is associated with discussing sex and related issues with family, substance use and peer influence. Those who discuss sex and related issues with their families less likely to practice premarital sex compared to those who did not. (AOR: 7.16; 95% CI 4.39-11.68). Similarly those who chew chat and consume alcohol were more likely to practice premarital sex. (AOR: 11.18; 95% CI 4.38-28.48) and (AOR: 3.70; 95% CI 2.04-6.73), respectively. Thirty one (18.6%), of the study subjects claimed they started sex before the age of 15 years. Twenty eight (16.8%) of sexually active respondents have got pregnant at least once prior to the study period out of which 15(53.6%) reported of history abortion, while 75(11.5%) of the respondents reported to have sign and symptoms of sexually transmitted diseases. From the total of 167 sexually active respondents only 5(3%) reported history of using condom consistently. Conclusion Significant number of young females had started sex very early and involved in high risk sexual behavior including non use of condom which leads to unwanted pregnancy and being infected with sexually transmitted diseases. Many factors affect the sexual behavior of young females including lack of information and cultural factors where sex and related issues are not openly discussed with families in addition to peer pressure and substance use. These kinds of findings call for family life time education including including parent-youth communication education, both while they are in school as School-based Sex and HIV/AIDS education program and while they are out of school as youth center based education.