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Efforts towards slowing down coronavirus (COVID-19) transmission and reducing mortality have focused on timely case detection, isolation and treatment. Availability of laboratory COVID-19 testing capacity using reverse-transcriptase polymerase chain reaction (RT-PCR) was essential for case detection. Hence, it was critical to establish and expand this capacity to test for COVID-19 in Ethiopia. To this end, using a three-phrased approach, potential public and private laboratories with RT-PCR technology were assessed, capacitated with trained human resource and equipped as required. These laboratories were verified to conduct COVID-19 testing with quality assurance checks regularly conducted. Within a 10 month period, COVID-19 testing laboratories increased from zero to 65 in all regional states with the capacity to conduct 18,454 tests per day. The success of this rapid countrywide expansion of laboratory testing capacity for COVID-19 depended on some key operational implications: the strong laboratory coordination network within the country, the use of non-virologic laboratories, investment in capacity building, digitalization of the data for better information management and establishing quality assurance checks. A weak supply chain for laboratory reagents and consumables, differences in the brands of COVID-19 test kits, frequent breakdowns of the PCR machines and inadequate number of laboratory personnel following the adaption of a 24/7 work schedule were some of the challenges experienced during the process of laboratory expansion. Overall, we learn that multisectoral involvement of laboratories from non-health sectors, an effective supply chain system with an insight into the promotion of local production of laboratory supplies were critical during the laboratory expansion for COVID-19 testing. The consistent support from WHO and other implementing partners to Member States is needed in building the capacity of laboratories across different diagnostic capabilities in line with International Health Regulations. This will enable efficient adaptation to respond to future public health emergencies.