Objective: This study aimed to assess the incidence and risk factors of treatment failure among Human Immunodeficiency Virus (HIV)/Acquired Immunodeficiency Syndrome infected (AIDS) children who were on Antiretroviral Therapy (ART) in Amhara National Regional State, Ethiopia. Methods: A retrospective follow-up study was conducted from January 2010 to March 2016. A total of 824 children under the age of 15 years who had started ART were included in the study. Data were collected from children’s medical chart and ART registration logbook using a standard checklist. A Weibull regression model was used to identify the risk factors for treatment failure. Adjusted Hazard Ratios with 95% confidence intervals were used to declare statistical significance. Results: The mean (±SD) age of the children was 6.4 ± 3.6 years with a median (IQR) follow up of 30.5 (IQR: 14.6, 51.4) months. Sixty-three children (7.7%, 95%CI:5.8, 9.5) developed treatment failure. Seventeen (27.0%) of whom were immunological and 46 (73.0 %) clinical failures. The incidence rate of treatment failure was 22.1/10000 person-months. The cumulative probability of failure was 0.4 with 28562.5 person-month observations. Lack of disclosure [AHR=4. 4, 95%CI (1.8, 11.3)], opportunistic infections during initiation of ART [AHR= 2.3, 95% CI (1.3, 4.1)] and prolonged follow up [AHR = 0.06, 95% CI (0.02, 0.18)] were the main predictors of treatment failure. Conclusion: This study revealed that the incidence of treatment failure remains a significant public health concern in Ethiopia. Undisclosed HIV status to children, the presence of opportunistic infections during initiation of ART and prolonged follow up was found to be the main predictors of treatment failure. Hence, early detection of the treatment failures and further studies on viral monitor need to consider.