In India, there are large disparities in the state-wise consumption of fertilizers and Punjab state is the ranked one with respect to its per hectare use. Fertilizer consumption per hectare also varies across farm size categories, with skewed tendency towards small farmers, irrigated areas and rabi season (winter season) indicating possibility of increasing agricultural production through fertilizers along with other complementary inputs. Therefore, the present study was conducted to examine the trend, pattern and determinants in the use of different fertilizer nutrients in the Punjab state. The economic efficiency of fertilizers use on farms in different regions of the Punjab state was also estimated to examine their impact on profitability and economic scope of their increased application. The information on fertilizer use and other variables was gathered for major crops i.e. wheat and rice, which use more than 80 per cent of total fertilizers. In state, the use of major nutrients (N+P+K) went up from just 65.3 thousand tonnes in triennium ending (TE) 1968 to 1463.7 thousand tonnes in TE 2004. The use of K in Punjab soils is not high because soils are rich in K-illitic mineral. Punjab state alone consumes about 9 per cent of the total fertilizers in India and the use is the highest on per unit area basis at 190.1 kg/ha of gross cropped area against 88.2 kg/ha in all India. The pattern of growth in consumption of fertilizers in Punjab was not different from India. The highest CGR of 25.65 per cent for N, 49.18 for P and 46.35 per cent for K was observed in first period 1965-66 to 1973-74, while CGR declined to 9.06, 10.93, and (-) 0.5 percent respectively in 1974-75 to 1988-89. The least growth was observed in 1989-90 to 2003-04 period, when use of N grew at 1.96 per cent, P205 at 0.6 per cent only and K20 at 10.17 per cent per annum. The growth pattern of fertilizer use matched with that of foodgrains production over time. The production of food grains grew at the rate of 12.6 per cent in the first period but the growth rate declined to 5.75 per cent in the second and further to 2.09 per cent in the third period. Fall in relative price of fertilizers, increase in yield and greater availability of institutional agricultural credit helped increasing use of chemical fertilizers in rice and wheat crops in the state. The impact of area under high yielding varieties on fertilizers consumption was the largest in wheat. Farmers applied more chemical fertilizers to raise productivity of high yielding varieties due to higher responsiveness. Primary data from farmers were used to examine the level of use of fertilizers, fertilization practices and their impact on productivity of wheat and rice in three districts of Punjab state categorized as low (Bathinda), medium (Amritsar) and high fertilizer (Ludhiana) using districts. The average application of P in wheat was almost around the recommended dose in Amritsar and Bathinda districts whereas in Ludhiana it was higher by 25.2 per cent. The use of N was invariably higher (by 25 per cent on an average farm) than the recommended dose of 50 kg/acre due to its strong visible impact on plant growth. There was no trend in its differential use on different farm size categories. Use of N was the highest in Ludhiana district and the lowest in Bathinda district. Method of application of fertilizer nutrients and use of green manure has significant impact on productivity of crops. Only 15 per cent of the farmers adopted green manuring and they perceived its impact on yield as positive. Majority of the farmers have not adopted green manuring due to its high cost. Only few farmers (4 per cent) got their soils tested and majority applied standard doses of N and P without testing of soils. Farmers depend more on informal advice of fertiliser dealers, peer groups, friends and relatives rather than expert/scientific advice with regard to application of major and micro nutrients. In low fertilizer using Bathinda district, nitrogen, farm yard manure (FYM), micro-nutrients and chemicals (weedicides, fungicides and pesticides) were estimated to have significantly influenced rice productivity, while the impact of phosphorous, irrigation, human labour and machinery (tractor) was non-significant. For wheat crop, N and P, as well as FYM significantly increased productivity on sample farms. In Amritsar district, the impact of FYM and micro-nutrients on rice productivity was significantly positive whereas in wheat crop, use of N, P and FYM significantly increased its productivity. The response of wheat and rice productivity to major nutrients such as N and P was not significant in high fertilizer using district of Ludhiana. Yet, the impact of FYM and micro-nutrients was significantly positive in rice. The study concludes that use of nitrogen and phosphorous in wheat in low and medium fertilizer using areas and nitrogen in rice in low fertilizer using area was economically efficient. Their use can be profitably enhanced on some sample farms, where it is smaller than recommended levels. The use of P was irrational in rice crop leading to fall in profits. The farm yard manure and micro nutrients were significant determinants of productivity of wheat and rice warranting their application for improving soil properties, organic matter and availability of minor elements. However, use of production inputs in Punjab has reached to a level where their higher use increases productivity marginally.