Abstract Bovine tuberculosis (bTB) is endemic and has a substantial impact on the livestock sector in Ethiopia and other low and middle-income countries (LMICs). With a national emphasis on dairy farm intensification to boost milk production and spur economic growth, the incidence of bTB is anticipated to rise. However, Ethiopia, like other LMICs, lacks a comprehensive national bTB control strategy due to the economic and social infeasibility of traditional test-and-cull (TC) approaches. To inform the development of such a strategy, we evaluated the effectiveness and feasibility of TC and test-and-segregation (TSg) strategies for bTB control on Ethiopian dairy farms. A TC approach was used at Farm A N = 62; comparative cervical test (CCT) > 4 mm, starting prevalence 11.3% while TSg was implemented at Farm B (N = 45; CCT > 4 mm, prevalence 22.2%), with testing intervals of 2–4 months. Both strategies achieved a reduction in bTB prevalence to 0%, requiring seven rounds of TC over 18 months at Farm A, and five rounds of TSg over 12 months at Farm B’s negative herd. The results show that adopting more sensitive thresholds CCT > 0 mm or single cervical test (SCT) > 2 mm during later rounds was pivotal in identifying and managing previously undetected infections, emphasizing the critical need for optimized diagnostic thresholds. Cost analysis revealed that TC was approximately twice as expensive as TSg, primarily due to testing, labor, and cow losses in TC, versus construction of new facilities and additional labor for TSg. This underscores the economic and logistical challenges of bTB management in resource-limited settings. Taken together, our study highlights an urgent need for the exploration of alternative approaches including TSg and or vaccination to mitigate within herd transmission and enable implementation of bTB control in regions where TC is not feasible.