The government said it was asking some officials of Eritrean political and community organisations to leave as they had been involved in spying and fund-raising for Eritrea's war effort.
A government spokeswoman stressed that Eritreans living peacefully in Ethiopia would not be targeted.
Hundreds are reckoned to have died since last month in the dispute along three fronts on the 600-mile frontier dividing the two countries. Ethiopia yesterday claimed to have killed 1,800 Eritrean troops and wounded 1,500 others in a battle at Erde Mattios at the Badme front on Thursday.
Ethiopian and Eritrean guerrillas joined forces to oust the Ethiopian military dictator Mengistu in 1991. In 1993 Eritrea, until then a region of Ethiopia, voted for independence, supported by post-Mengistu Ethiopian authorities. But relations between the two countries had become strained in the past year.
Four African presidents will visit Ethiopia and Eritrea next week in a new initiative by the Organisation of African Unity, aimed at resolving the conflict. President Blaise Compaore of Burkina Faso, the current OAU chairman, will be accompanied by Hassan Guled Aptidon of Djibouti, Robert Mugabe of Zimbabwe and Pasteur Bizimungu of Rwanda, the Eritrean officials said.
A special Italian envoy also arrived in the Eritrean capital yesterday to add Italy's voice to calls for a negotiated end to the conflict between the countries - both former Italian colonies.
A peace effort by the US and Rwanda will now take a back seat. Rwanda became involved because those who took control after the ethnic slaughter of 1994 have long been close to the Ethiopian Prime Minister, Meles Zenawi, and Eritrean President Isaias Afwerki.Reuse content