A field experiment was conducted during 2007–08 to study the effect of different levels of nitrogen and phosphorus on oil quality of Palmarosa (both physical and chemical tests) under rainfed conditions on vertisols. The experiment was laid out in factorial randomized block design with 12 treatments and three replications. The treatments consisted of four levels of nitrogen viz., 0 kg (N0), 40 kg (N1), 60 kg (N2) and 80 kg (N3) and three levels of phosphorus 0 kg (P0), 20 kg (P1) and 40 kg (P2)/ha. The study revealed that highest significant difference was recorded in acid value (2.92) (2.23) and ester value (33.65) (28.39) when treated with the combinations of nitrogen @ 80 kg/ha (N3) and phosphorus @ 40 kg/ha (P2), respectively, followed by nitrogen @ 60 kg/ha (N2) and phosphorus @ 20 kg/ha (P2), while nitrogen @ 0 kg/ha (N0) and phosphorus @ 0 kg/ha (P0) showed lowest acid value (1.01) (1.94) and ester value (20.64) (23.67), respectively, whereas the physical properties of the essential oil showed neither deteriorated nor improved by nitrogen and phosphorus treatments. Both the values of acid and ester were found increased with each treatment combination of N and P levels.