Access to urban serviced land is essential for the establishment and growth of micro and small enterprises (MSEs), yet gaps often exist between land allocation plans and actual implementation. This study examines performance gaps in urban serviced land allocation for MSEs using evidence from municipal and zonal levels in Gedeo Zone, Ethiopia. The analysis is based on secondary administrative data obtained from Dilla Municipality (2020/21–2024/25) and the Gedeo Zone Urban Development and Infrastructure Department (2015/16–2019/20). A descriptive and comparative approach was employed to assess discrepancies between planned targets and actual performance in serviced land allocation, land preparation, and land supply. The findings reveal persistent performance gaps at both governance levels. In Dilla Municipality, actual serviced land allocation for MSEs remained consistently below planned targets despite increasing plans over time. At the zonal level, both land preparation and land supply for MSEs achieved only a small share of planned targets, with particularly severe bottlenecks in the transfer of prepared land to final users. These results highlight systemic implementation challenges and underscore the need to strengthen coordination, implementation capacity, and monitoring mechanisms to improve access to serviced land for MSEs and support inclusive urban development.