A cross-sectional study was conducted from November 2007 to April 2008 to estimate the prevalence of bovine tuberculosis using the comparative intradermal tuberculin test in 510 heads of cattle in intensive, semi-intensive and small holder dairy farms of Mekelle and its surrounding. In addition, a questionnaire survey was conducted in 230 people to assess the public health implication of the disease. In addition, milk samples were taken from 39 tuberculin positive cows for the identification of pathogen. The overall prevalence of bovine tuberculosis was recorded 13.9 % in dairy farms. Herd prevalence was noticed 54 % in the area. Using confidence interval of 95%, statistically significant variables was observed among age (x2=19.4, P <0.001), herd size (x2=8.0, P<0.001), breed (x2=19.4, P<0.001), management (x2=8.8, P<0.003) and body condition (x2=53.0, P<0.001). The people in study area have poor awareness on bovine tuberculosis. About 50% of respondents were aware that cattle are affected by tuberculosis. Also, 40% of the people know that raw milk is a vehicle of transmission of disease. Cattle owners and non cattle owners had 5%, 3% tuberculosis patients in their house, respectively. The organism was isolated from 15.4% of milk samples on Lowenstein-Jensen medium. It is deduced that sharing of the same households by tuberculosis patient and reactor cattle suggest transmission of Mycobacterium species between cattle and their owners.