Land degradation is primarily caused by accelerated soil erosion rate, which results in a loss in soil fertility and agricultural production. An improved understanding of the effect of soil bund spacing is a precondition for sustainable land management practices on sloping highlands. We examined the effects of bund spacing on soil loss, runoff, and soil water content on teff (Eragrostis tef [Zucc.] Trotter) cropland in an area of 9 % slope on Luvisol soil in the Aba Gerima (micro) watershed of the Lake Tana Basin, Ethiopia. We measured these parameters during 2018 and 2019 on five adjoining runoff plots (each 30 m long × 3 m wide) separated by metal sheets 0.35 m high. We used a plot with no bunds as a control. In the other four plots, we installed bunds at spacings of 27.2, 12.7, 7.87, and 5.45 m. Both runoff and soil loss were considerably higher in the control plot than in the plots with bunds. Narrower bund spacings resulted in substantial reductions of runoff and soil loss. The two-year average runoff depths in the control, 27.2, 12.7, 8.97, and 5.45 m bund spacing plots were 517, 454, 365, 306, and 243 mm, respectively. Average soil loss for the control plot was 25.7 ton ha⁻¹, whereas it was 17.9, 11.8, 6.5, and 4 ton ha⁻¹ for the 27.2, 12.7, 8.97, and 5.45 m bund spacing plots, respectively. The efficiency of soil bunds in enhancing soil water content increased with reduced soil bund spacing. Over the course of the measurement period, average soil water levels for soil bund spacings of 27.2, 12.7, 8.78, and 5.45 m were 0.30 kg kg⁻¹, 0.31 kg kg⁻¹, 0.32 kg kg⁻¹, and 0.32 kg kg⁻¹, respectively. Further cost–benefit analyses and statistical tests are needed to determine optimum bund spacings in the Ethiopian highlands.