Abstract The objective of the study was to analyze the variability of various climate indicators across the agro-climatic zones (ACZs) of the Jema watershed. The variability was analyzed considering mean annual rainfall (MARF, mm), mean daily minimum temperature (MDMinT, °C), and mean daily maximum temperature (MDMaxT, °C). A one-way analysis of variance (ANOVA) was employed to test whether group mean differences exist in the values of the indicated climatic indicators among the ACZs of the watershed. The coefficient of variation was computed to analyze the degree of climate variability among the ACZs. Rainfall and temperature data sets from 1983 to 2017 were obtained from nearby meteorological stations. The effect of climate variability in the farming system was assessed with reference to local farmers’ experience. Ultimately, the values of the stated indicators of exposure to climate variability were indexed (standardized) in order to run arithmetic functions. The MARF decreases towards sub-alpine ACZs. Based on the result of the ANOVA, the two-tailed p-value (≤ 0.04) was less than 0.05; that is, there was a significant variation in MARF, MDMaxT (°C), and MDMinT (°C) among the ACZs. The coefficient of variation showed the presence of variations of 0.18–0.88 for MARF, 0.18 to 0.85 for MDMaxT, and 0.02–0.95 for MDMinT across the ACZs. In all of the indicators of exposure to climate variability, the lowest and highest indexed values of coefficient of variation were observed in the moist–cool and sub-alpine ACZs, respectively. Overall, the aggregate indexed values of exposure to various climate indicators ranged from 0.13–0.89 across the ACZs. The level of exposure to climate variability increased when moving from moist–cool to sub-alpine ACZs. The overall crop diversity declined across the ACZs of the watershed. Nevertheless, mainly because of the rise in temperature, the climate became suitable for cultivating maize and tef even at higher elevations. In order to adapt to the inter-annual variability of the rainy season, the process of adapting early-maturing crops and the use of improved seeds needs to be enhanced in the watershed, especially in the higher-elevation zones. It is also essential to revise traditional crop calendars and crop zones across the ACSz.