This research investigated the adaptive challenges of local faith-based civil society organizations (CSOs) in Ethiopia. It also assessed the sustainable adaptive measures taken by the local CSOs in line with the “seven key dimensions affecting the sustainability of the CSO sectors namely legal environment, organizational capacity, financial viability, advocacy, service provision, sectorial infrastructure, and public image as described by USAID” (USAID, 2018a, p. 267). The research was conducted at five selected local CSOs in Ethiopia. The top and middle-level leaders, staff, volunteers, project beneficiaries, and stakeholders of the CSOs were the participants in the research. The leading challenge was financial viability, followed by an unfavorable legal environment, poor advocacy practice, and weak organizational capacity. The CSOs studied have applied impressive coping mechanisms to withstand the adaptive challenges and thrive. These mechanisms involved redesigning and restructuring their organizations, forming networks and linkages with like-minded organizations, mobilizing in-kind contributions from local churches, making proactive adjustments of their internal policies, and adjusting to the COVID-19 pandemic. Asset-based community development (ABCD) is recommended as an effective transformational approach for the sustainability of CSOs.