Although soil compaction has been reported as one of the most serious problems in mechanized sugar cane production, its impacts on soil physicochemical properties and plant growth and sugar yield have not been quantified in the Ethiopian Sugar Estates. A field experiment was conducted in 2016 at Metahara Sugar Estate with the objective of evaluating the effects of initial soil moisture content and number of tractor passes on compaction and resulting impact on selected soil physicochemical properties and sugarcane growth parameters and sugar yield. The field experiment consisted of factorial combinations of compacted soils at three different soil moisture levels (on 4th, 8th and 12th days after irrigation) and six tractor traffic passes (0, 4, 8, 12, 16, and 20 passes) which were... replicated three times. The result of the study showed that the highest mean values of dry bulk density and penetration resistance were recorded in plots compacted by twenty to and fro passes of tractor. Both bulk density and penetration resistance showed non-linearly increasing pattern with increasing number of passes. The tallest (196 cm) and shortest (171 cm) cane at the age of 8 months were recorded, respectively, in plots with zero and 20 passes of tractor. Significantly higher values of sugar yield were recorded in plots with zero number of passes (control). Imposing of different number of passes on 4th and 8th days after irrigation gave significantly lower yield than the 12th day after irrigation. Bulk density of the studied farm fields recorded after compaction by 20 traffic passes on the 8th day after irrigation, which corresponded to a gravimetric moisture content of 29.30%, was in excess of the root restriction initiation level. These results imply that it is advisable to avoid field operations involving Magnum 315 tractor on light soils before the 8th day after irrigation and when the gravimetric moisture content of the soils is at/near 29.30%. Management plans should include subsoiling operations to loosen soil in the field only when compaction levels exceed 1.45 g cm-3 (clay texture). There is a need for future study on other areas such as the heavy soils, other tractor passes and moisture levels of soils and other sugar cane varieties at the estates.