This study aimed to estimate HIV incidence among women at higher HIV risk in Addis Ababa, Ethiopia using cross-sectional data. To refine the estimate, we sought to determine a local correction factor by estimating a false recent rate for the BED assay. The overall study had two parallel phases: cross-sectional incidence and BED false recent (BED FR). A total of 1856 women at higher HIV risk were enrolled into the cross-sectional phase. For the BED FR, 500 women and 70 men with known HIV infection of greater than 12 months were enrolled. Rapid HIV tests were used to assess participant HIV status. Samples from women with positive results on HIV rapid testing were then analyzed using the BED assay to determine incident HIV infections. The overall HIV prevalence was 11.3%, with women greater than 25 years old having a higher prevalence (26.5% vs. 7.9% for younger women). The overall unadjusted HIV incidence was 3.3%. The estimated HIV incidence was 2.6% when adjusted using the locally derived false recent rate of 3.5%. Similar incidence rates were found between the younger and older age groups. This is one of the first field-based studies of HIV incidence in Ethiopia; it demonstrates that there is sufficient incidence to warrant further HIV prevention efforts among women at higher risk of HIV infection.