Background Diabetes is a chronic, metabolic disorder characterized by elevated level of blood glucose. In order to delay and prevent diabetes related complications, healthy meal planning and leading active life are very crucial. However, appropriate feeding practice among type 2 diabetic patients is low in many developing countries including Ethiopia. Therefore, the aim of this study was to assess dietary practice and associated factors among type 2 diabetic patients. Methods Institution based cross sectional study was conducted from July to December 2019. A total of 422 type 2 diabetic patients who had follow up at the diabetes clinic of the University of Gondar Comprehensive Specialized hospital were include in the study. Logistic regression was used to see the strength of the association between dependent and independent variables. In the logistic regression, both bivariable and multivariable logistic regression analysis were computed to identify factors associated with dietary practice. Results The overall prevalence of good dietary practice among type 2 diabetic patients was 46.7 % [95 % CI: 41.7, 51.4]. In the multivariable logistic regression analysis attending secondary and above education [AOR = 4.08, 95 % CI: 1.76, 9.46], high wealth status [AOR = 5.34, 95 % CI: 2.72, 10.50], presence of family support [AOR = 2.54, 95 % CI: 1.40, 4.63], and absence of difficulty of choosing food [AOR = 2.27, 95 % CI: 1.47, 3.53] were significantly associated with good dietary practice. Conclusions Less than half of the patients with type 2 diabetes had good dietary practice. Dietary practice was good among high economic status, presence of family support, high educational level and no difficulty of choosing food. Therefore, strengthening income generating activities, improving literacy rate of nations, developing family engagement and food choosing strategies by the health care providers, policy makers and the Government are very crucial to improve good dietary practice among type 2 diabetic patients.