Human disturbance has led to excessive deforestation and to a very limited forest cover in the Afromontane zone of Ethiopia, which forms a large part of the country. Thus urgent conservation measures are required to ameliorate the situation. Understanding the natural regeneration processes and the dynamics of plant populations of tree and shrub species has a practical application in the restoration of these habitats. The present study focuses on the population dynamics and regeneration of an early successional shrub Dodonaea angustifolia and a late successional tree Olea europaea ssp. cuspidata in southern Wello, Ethiopia. Population structure and dynamics, regeneration and seed banks in dry Afromontane habitats were considered. For both species, three population structure patterns were identified: 1) high density, reversed J-shape structure with many seedlings and few large individuals, 2) lower density, unimodal structure with higher proportions of plants of intermidiate size, 3) high density with higher proportions of large plants , in some cases bimodal with small and large individuals. Vegetation type and protection time were found to have a significant effect on the population structure of both species. Dodonaea can establish itself on degraded land, once the disturbance has ceased Projection matrix analysis on observations from permanent plots in Dodonaea populations in protected and unprotected sites resulted in one declining population, and one increasing in the protected site and declining populations at the unprotected site. The overall projected growth rate in Dodonaea calculated from a pooled matrix indicated positive population growth. The factors influencing the population growth, recruitment and survival are discussed. The persistence of Olea populations seems to depend on the more stable environmental conditions in later successional stages of forest vegetation. There are possibilities of natural regeneration of Olea if regenerating individuals still occur in the area. Rainfall seasonality is a dominant factor in regulating establishment, recruitment, survival and growth, particularly during the seedling stage. Moreover, shade and herbivory are factors that need consideration. Since Olea grows better under shade than in the open sun, successful regeneration for this species relies on shade from other plants and on protection from grazing, at least during the seedling stage. Most of the species that germinated from the seed banks were herbs and grasses with very few shrub and tree species. There was low correspondence between species composition of the seed banks and that of the standing vegetation. Spatial and temporal variation in demographic parameters among populations of Dodonaea and Olea can be attributed to human and environmental influence. Under protection, both Dodonaea and Olea seem to have a possibility to regenerate naturally. Further research should consider factors mentioned in detailed investigations of other dominant Afromontane forest species.