Freshwater resources scarcity is becoming a limiting factor for development and sustenance in most parts of Ethiopia. The Debre Mewi watershed, in northwest Ethiopia, is one of such areas where the need for supplemental water supply through rainwater harvesting is essential. Suitable water harvesting sites were identified through overlay analysis considering both social and technical parameters, such as land use/land cover, slope gradient, soil texture, flow accumulation and stakeholders' priority. This was performed with the integration of GIS and remote sensing applications. Knowledge of runoff resulting from rainfall is most important for designing any water harvesting structure. Direct field-level measurement of runoff is always good, but it is time consuming, labour intensive and expensive. In conditions where direct measurement of runoff could not be possible, remote sensing technology and GIS combined with runoff models are proven to be effective. In this study, the remotely sensed satellite data (Quickbird2) provided spatial information on land use/land cover. Precipitation was obtained from the nearest meteorological station, and soil data were acquired form laboratory analysis. The GIS tools were used to store, manipulate and estimate runoff depth, surface storage and runoff volume, applying Soil Conservation Service (SCS) Curve Number (CN) formula. The direct runoff volume estimated using SCS-CN model is 146,697 m(3) for the month of August, at Debre Mewi watershed, which covers about 508 ha. The result was compared with measured values, and closer relationship was found. This indicates that there is enough runoff water to be harvested for different uses. Remote sensing was found to be a very important tool in providing input parameters. GIS was also found to be a very important tool in mapping and integrating the different variables, in the process of runoff estimation and suitable water harvesting sites selection.