The study assessed the pattern and appropriateness of medicines prescribed to outpatients at Gondar University Referral Hospital in northwestern Ethiopia. An institution-based cross-sectional study was employed, through interviews and prescription reviews, among 346 patients at the outpatient pharmacy, from 2nd to 20th of May 2016. Data on sociodemographic profile of patients and medicines prescribed to them were collected. A mean of 1.72 medicines per encounter was prescribed, over a third of the total being anti-infectives. Patients were able to get about 85% of these medicines. An unskilled government employee would be required to work more than one and a half day to be able to afford the average priced medicine. Among prescriptions with two or more medicines, more than a third had at least one potential drug-drug interaction (PDDI), the commonest pair containing amoxicillin and doxycycline. Being male, being older (50–59 years), and increased number of medicines were associated with higher likelihood of PDDIs. In conclusion, the number of medicines prescribed per encounter was up to accepted standard. However, their availability fell short, together with considerable cost. Regarding appropriateness, a significant proportion of potential drug-drug interactions is identified and associated with patient’s sex, age, and number of medicines prescribed.