This paper examines interethnic conflict on grazing land previously accessed as common property. The study was undertaken in Mieso District of eastern Ethiopia where two ethnic groups experience different production systems - pastoral and agropastoral. Game theoretic approach and analytic narratives have been used as analytical tools. Results show that the historical change in land use by one of the ethnic groups, resource scarcity, violation of customary norms, power asymmetry and livestock raids are some of the factors that have contributed to the recurrence of the conflict. The role of raids in triggering conflict and restricting access to grazing area becomes particularly important. Socio-economic and political factors are responsible for power asymmetry and increasing scale of raids. The joint effect of an increase in trend of violence and a decline in capacity of customary authority in conflict management advances state role in establishing enforceable property rights institutions. This would be successful only if policies and intervention efforts are redirected at: 1) suppressing incentives for violence, 2) establishing new institutional structures, in consultation with clan elders of both parties and 3) building internal capacity to monitor conflict-escalating events.