The Walia Ibexes, meanwhile, were unlucky not to have come away with maximum points in Saturday's group A opener against Mozambique and will set out to get their title race back on track.
Match preview
Algeria kicked off their quest for a first-ever Africa Nations Championship crown when they secured a hard-fought 1-0 victory over Libya in the tournament's opener last Friday.
Following a goalless first half in Baraki, the breakthrough strike came from the penalty spot three minutes before the hour mark as Aimen Mahious converted with aplomb to hand the hosts a dream start to the campaign.
Off the back of a shaky pre-tournament campaign, where they failed to win any of their three warm-up friendlies, Madjid Bougherra will be impressed with his side's opening-day display and hope it can serve as a springboard for a run to the title.
The goal for Algeria will be to improve on their first and only CHAN outing, which came back in 2011, when they suffered a 1-0 loss against Sudan in the third-place playoff after losing to Angola on penalties in the semi-finals.
Ethiopia, on the other hand, were guilty of a lack of cutting-edge in their group opener as they were held to a somewhat disappointing goalless draw by Mozambique last Saturday.
Despite being in the ascendancy for most of the game and seeing a bulk of the possession, the Walia Ibexes failed to convert multiple clear-cut chances before settling for a share of the spoils.
This followed a 1-0 defeat at the hands of Morocco in their final warm-up fixture on January 7 courtesy of a late strike from Saifeddine Alami at Rabat's Mohammed VI Football Academy.
Wubetu Abate's side head into the midweek matchup knowing failure to come away with maximum points could deal a huge blow to their quest for a first-ever Africa Nations Championship title.
However, they must overcome the challenge of a spirited Algeria side who are unbeaten in each of the last seven meetings between the teams, claiming four wins and three draws since a 3-1 loss in their 1968 Africa Cup of Nations clash.
Algeria African Nations Championship form:
W
Algeria form (all competitions):
W
W
D
L
D
W
Ethiopia African Nations Championship form:
D
Ethiopia form (all competitions):
D
D
L
W
D
D
Team News
Friday's match-winner Mahious was forced off injured in the 61st minute and the USM Alger forward is a major doubt for Algeria.
Should he fail to shake off the injury, 28-year-old Karim Aribi will push for a place in the XI, teaming up with Meziane Bentahar and Aimen Lahmri in the final third.
Bougherra went with a back four of Mokhtar Belkhiter, Zineddine Belaid, Ayoub Abdellaoui and Youcef Amine Laouafi against Libya and we expect to see an unchanged defensive set up.
Off the back of an injury-free outing against Mozambique, Ethiopia boasts a clean bill of health and we expect Abate to name an unchanged starting XI for Tuesday's crunch tie.
With that said, Mesud Mohammed, Gatoch Panom and Fuad Fereje should retain their roles at the centre of the park, while Mignot Debebe and Adama City man Million Solomon should form the centre-back pairing.
Algeria possible starting lineup:
Guendouz; Belkhiter, Belaid, Abdellaoui, Laouafi; Draoui, Mrezigue; Lahmri, Kendouci, Bentahar; Aribi
Ethiopia possible starting lineup:
Gebremichael; Hamid, Debebe, Solomon, Yesuf; Mohammed, Panom, Fereje; Gebremikael, Markneh, Gugsa
We say: Algeria 1-0 Ethiopia
Riding on the wave of the home support, Algeria have an impressive added advantage here and will be looking to back up Friday's display with another show of class. While we expect Ethiopia to put up a fight, we are backing Bougherra's side to pick up where they dropped off and claim all three points on home soil.