ObjectiveTo estimate and compare the cost-effectiveness of COVID-19 critical care intervention approaches: noninvasive (oxygen without intubation) and invasive (intubation) management in Ethiopia.MethodsA Markov model is used to compare the costs and outcomes for non-invasive and invasive COVID-19 clinical interventions using both primary and secondary data sources. Healthcare provider costs (recurrent and capital cost) and patient-side costs (direct and indirect) were estimated and reported in United States Dollars (US$), 2021. The outcome measure used in this analysis was DALYs averted. Both the average cost-effectiveness ratio (ACER) and incremental cost-effectiveness ratio (ICER) were reported. One-way and probabilistic sensitivity analyses were applied to assess the robustness of the findings. The analysis is conducted using Tree Age pro health care software 2022.ResultThe average cost per patient per episode for mild/moderate, severe, noninvasive, and invasive critical management was $951, $3449, $5514, and $6500, respectively. According to the average cost-effective ratio (ACER), non-invasive management resulted in $1991 per DALY averted, while invasive management resulted in $3998 per DALY averted. Similarly, the incremental cost-effective ratio (ICER) of invasive compared to noninvasive management was $ 4948 per DALY averted.ConclusionClinical management of critical COVID-19 cases in Ethiopia is associated with a significant financial burden. Invasive intervention is unlikely to be a cost-effective COVID-19 intervention in Ethiopia compared to noninvasive critical case management using a willingness to pay threshold of three times GDP per capita.Supplementary InformationThe online version contains supplementary material available at 10.1186/s12962-023-00446-8.