It was the second time Prime Minister Abiy Ahmed's government and the OLA had sat down this year aiming to end a five-year insurgency in the restive Oromia region.
Classified as a "terrorist organisation" by Addis Ababa, the OLA has been fighting the government since 2018 after splitting from the Oromo Liberation Front (OLF) when it renounced armed struggle.
"Due to the intransigence of the other party the talks have come to an end without an agreement," Abiy's national security adviser Redwan Hussein posted on X, formerly Twitter.
"The obstructive approach and unrealistic demands of the other party are the principal reasons why these talks could not succeed."
The OLA said it tried "to negotiate a space for a meaningful change in the governance of the Oromia region" during the talks in Dar es Salaam and an earlier round also in Tanzania.
"True to form, the Ethiopian government was only interested in co-optation of the leadership of the OLA rather than beginning to address the fundamental problems that underlie the county's seemingly insurmountable security and political challenges," spokesman Odaa Tarbii said in a statement on X.
The OLA had stated on November 13 that its leader, Jaal Maroo, was in Tanzania to lead the talks, and had expressed its determination to achieve a "peaceful political settlement".
Abiy is of Oromo descent but the wider community, Ethiopia's largest ethnic group, has long complained of marginalisation and their homeland is plagued by instability and armed violence.
Since the OLA broke off and started fighting, a string of armed groups have risen up in Oromia claiming to be part of its cause, although they are only loosely tied.
The OLA's strength, estimated at a few thousand men in 2018, has increased in recent years, though observers believe it is insufficiently organised or well-armed to pose a real threat to the government.
Oromia, which surrounds Addis Ababa, has seen ethnic massacres in recent years, particularly in the Qellem Wollega and West Wollega areas.
The OLA has been accused by Abiy's government of being responsible for the killings. It denies the charge.
The government in turn is accused of waging an indiscriminate crackdown that has fuelled Oromo resentment.
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