With their many benefits including better crop yield and nutrient delivery, nano fertilizers are a promising option in the agriculture sector. The production and formulation of nanoparticles with regulated size, shape, and content are required to prepare nano fertilizers. Metals, metal oxides, and polymers are among the materials from which nanoparticles are made using chemical and physical processes. Subsequently, these nanoparticles are mixed into fertilizers to enhance plant absorption and availability of nutrients. Nano-fertilizers have several benefits, including efficient nutrient absorption, reduced nutrient losses, minimized environmental pollution, optimized resource utilization, and controlled release of nutrients for sustained plant nourishment. Studies have demonstrated that by boosting nutrient availability, encouraging root development, and strengthening stress tolerance, nano fertilizers can greatly enhance crop yields. Moreover, it has been discovered that they increase microbial activity and soil fertility, which improves soil health and long-term sustainability. Nano-fertilizers can be applied in different ways, like foliar spraying, seed coating, soil integration, or irrigation systems. They are beneficial in precision agriculture for better nutrient management, soil restoration, and addressing nutrient deficiencies. Furthermore, they potentially lessen the negative environmental effects of traditional fertilization methods. Nevertheless, there are still several issues that need to be resolved before nano fertilizers may be commercialized and widely used. Regulatory frameworks, environmental destiny, potential toxicity of nanoparticles, and cost-effectiveness are some of these challenges. The purpose of this review is to provide readers with a comprehensive understanding of the benefits of nano fertilizers. It will cover topics such as their preparation and characterization, potential side effects, and a diverse range of applications. Additionally, it will present an overview of the importation of chemical fertilizers and explore the prospects of utilizing fertilizers in the Ethiopian context.