Background <p>The purpose of pharmaceutical distribution is to ensure a consistent supply of quality-assured pharmaceuticals to service delivery points to avoid stock outs and/or overstocks. However, choosing a resource-efficient method is difficult because of the two competing interests of lowering distribution costs and improving service level. This study aimed to assess the public sector pharmaceutical distribution system and its challenges in central Ethiopian Pharmaceuticals Supply Service and selected branches.</p> Methods <p>This study was conducted at the Central Ethiopian Pharmaceuticals Supply Service and four regional branches between December 2021 and February 2022, utilizing a concurrent parallel mixed-methods design. The quantitative component involved 104 respondents, with data analyzed using SPSS 23 through descriptive statistics. For the qualitative component, 17 key informants participated, and the data were manually analyzed through thematic analysis using an inductive approach.</p> Results <p>Warehouse management was performed relatively well compared to inventory management and delivery practices, with overall mean scores of 3.22, 3.14, and 3.08, respectively. The qualitative study highlighted key challenges, including insufficient stock, off-schedule deliveries, the provision of near-expiry products, and vehicle constraints.</p> Conclusions <p>This study demonstrated that improving warehousing, inventory management, and delivery practices, while addressing key challenges, could significantly improve the effectiveness of pharmaceutical distribution.</p>