BACKGROUND Obstetric danger signs are not the literal obstetric complications, merely symptoms that are well named by non-clinical personnel. The identification of these danger signs and its relation with complications during pregnancy would increase the capacity of women, their partners and families to seek for timely health care, following the appropriate steps to insure a safe birth and post-partum. The aim of this study was to assess the knowledge of obstetric danger signs and associated factors among pregnant women attending antenatal care in Yirgacheffe town, Gedeo zone, Southern Ethiopia. METHODS Institutional-based cross-sectional study was conducted from March 15-April 15, 2016. Data on pregnant women were collected using a pre-tested and interviewer administered structured questionnaire from 342 women using systematic random sampling technique. Bivariate and multivariate logistic regression was performed using SPSS version 20.0 software. RESULTS A total of 342 (90%) pregnant women were included in the study. The level of obstetric knowledge of danger signs was 21.9% (95% CI: 20.2-55.65%). Maternal education (AOR = 0.26, CI: 0.08, 0.88), paternal education (AOR = 0.13, CI; 0.04, 04) and time taken to reach health facilities on foot (AOR = 0.06, CI: 0.02, 0.17) were negatively associated factors while maternal age (AOR = 3.68, CI: 1.30, 10.46), paternal occupation (AOR = 4.65, CI: 1.82, 11.87), place of residence (AOR = 2.61, CI: 1.35, 5.04) were positively associated factors with knowledge of obstetric danger signs. CONCLUSIONS Maternal and paternal education, maternal age, paternal occupation, place of residence and time taken to reach health facility on foot were the main factors for knowledge of obstetric danger signs. Increasing knowledge of key danger signs, creating and promoting income generating mechanisms need to be continuously done at the health facility and the community as it makes ready women and their families for prompt and appropriate decisions and measures in case of obstetric danger signs.