The Boeing 737 passenger jet had 149 passengers and eight crew members on board, Ethiopian Airlines said in a statement.
The plane lost contact at 8.44 am local time around Bishoftu, a town southeast of the capital Addis Ababa.
The Ethiopia’s prime minister offered condolences to victims’ families on Twitter.
“We hereby confirm that our scheduled flight ET 302 from Addis Ababa to Nairobi was involved in accident today,” the airline said in a statement on Sunday.
“It is believed that there were 149 passengers and eight crew on board the flight but we are currently confirming the details of the passenger manifest for the flight.”
This is a developing story. More details awaited