This study sought to determine trends in and factors associated with stigma against people with HIV/AIDS in Ethiopia. Rural data from the 2005 and 2011 Demographic and Health Surveys were analyzed. HIV testing rates among males increased dramatically from 2005 to 2011 (8–35 %). Among females, testing rates dropped 10 % during the same period. HIV knowledge was associated with stigma, shown by a negative correlation in both data waves, but groups with higher knowledge tended to have lower stigma. Lower levels of knowledge were uniformly associated with higher levels of stigma, but higher levels of knowledge, combined with higher levels of education, were associated with lower levels of stigma in a multiplicative way. Improvements in knowledge can serve as an important intermediate process to behavior change. The found interaction suggests improvements in either education or knowledge can reduce stigma, and when both are improved, stigma reduction will be more dramatic.