Mastitis is the most common disease of dairy cattle worldwide, causing economic losses due to reduced yield and poor quality of milk. It is of particular concern in Ethiopia, where effective prevention and control practices are lacking. The objective of the present prospective longitudinal study was to estimate the incidence rate of clinical mastitis (CM), identify the risk factors, isolate the bacterial agents, and determine the risk of recurrence. For this purpose, a total of 217 lactating cows were followed up every two weeks from calving to drying off or the end of the study period. Of these, 79 (36.41%) developed CM, of which 23% had recurrent infections in the same or a different quarter. The overall incidence rate of CM was 83.72 (95% CI: 63.2–98.2) cases per 100 cow-years at risk. In the multivariable Cox regression model, the risk of CM was found to be significantly higher in multiparous cows (HR = 1.96; p = 0.03), in cows with a history of mastitis (HR = 2.04; p = 0.030), in cows that had severely keratinized teat end condition (HR = 7.72; p < 0.001) and in cows kept in poorly cleaned barns (HR = 1.89; p = 0.007). The pathogenic bacteria isolated from mastitis-positive cows wereStaphylococcus aureus(28.1%),E. coli(21.1%),Bacillusspp. (14%),Streptococcusspp. (14%), coagulase-negative staphylococci (12.3%), non aureus staphylococci (5.3%),Enterobacterspp. (3.5%),Klebsiellaspp. (1.8%),Corynebacteriumspp. (1.8%), andProteusspp. (1.8%). The high incidence rate of CM in the present study shows that the disease spreads rapidly and can be responsible for a significant economic loss to milk producers in the study area. Therefore, raising awareness among dairy farmers, early detection and treatment of cases, post-milking teat disinfection, improvement of the hygienic status of cows and barns, use of dry cow therapy, and culling of chronic cases are recommended as viable measures to prevent and control clinical mastitis in the study area.