The result meant the Walya Antelopes will pack their bags for Addis Ababa and Francis Kimanzi’s side will book a place in the last eight by holding 2012 Africa Nations Cup finalists Sudan where a win could also see them top the group.
Adane Gebreyes gave the Walya Antelopes the lead from the spot in the 16th minute after defender Zoya Siyeni stopped a goal bound shot with his hands.
It took Malawi only 11 minutes to level matters when Henry Kabicchi equalized for with a thundering free-kick, a contender of the goal of the tournament.
Both sides struck the cross bar in the second half but at the final whistle, Malawi top the group on five points after a win and two draws with Stars on three and Sudan on one following in that order as winless Ethiopia crashed out.
Stars will take on to the pitch from 1:55pm local time (+3GMT) where another victory will confirm them the pool winners having begun their CECAFA campaign with a 2-0 defeat to Malawi.
Kimanzi made three changes in the Ethiopian game and they repaid his faith by getting Kenya’s first win with Bob Mugalia and Victor Ochieng debut goals sealing a 2-0 win over Ethiopia in pouring rain.
He is expected to keep faith with the likes of Victor Ochieng, Titus Mulama, Kevin Kimani, Jamal Mohammed while at the back Pascal Ochieng, Brian Mandela, Mulinge Munandi and Yusuf Juma will hold fort.
Sudan are fielding a largely experimental side but though they have drawn both their matches, they have shown flashes of brilliance with Mohammed Osman at the heart of some of their best moves.
They beat Kenya 2-1 in an LG Cup friendly match in June so will be psychologically ready for the task at hand.
Elsewhere, Rwanda ended their Group A commitments with a perfect run when captain Olivier Karekezi came off the bench to lead his side to a come-from-behind 5-2 victory with a quick fire hat-trick
Karekezi netted in the 78th, 80th and 86th minutes to complete the rout after Jean Claude Mugiraneza had levelled the tie at 2-2 as hopes of the biggest upset in the tournament faded.
Djibouti, who have never won a CECAFA Senior Challenge tie had taken a shock 2-1 lead to the break.