The study examined the economic analysis of groundnut production in Charanchi Local Government area of Katsina State. Purposive and random sampling techniques were employed to select 80 respondents. The tools for collection of primary were structured questionnaires. The data were analyzed using both descriptive such as percentage and frequency and inferential statistics. These included percentage, frequency and farm budget model. Farm budget model was used to estimate cost and returns from groundnut production in the study area.The study revealed that the average cost of production per hectare wasN11, 213.35. The study further revealed that the average revenue and net farm income per hectare were N22, 808.58 and N11, 595.23 respectively. The result shows that the return to naira invested was 1.03 which implied that for every naira invested in groundnut production in Charanchi LGA, a farmer will make a profit of N1.03. The problems encounter by the farmers included pest and diseases, instability market price, inadequate inputs and high cost of inputs. The study concluded that groundnut farming is profitable in the study area. It is recommended that Government should link farmers to relevant loan agencies, extension services should be made available to farmers to get more profit and improve seed should be made available and affordable to the farmers.