The effect of substituting N with neem cake at different levels on urea hydrolysis and N-transformation in soils at periodic intervals measuring urea-, NH4+-and NO3-N in the medium was studied. The amount of unhydrolysed urea-N decreased from 99.86 to 5.42 mg N/kg in soil treated with 100% N through urea; the respective values were 83.87 to 11.88, 61.99 to 14.02 and 33.82 to 8.21 for soil amended with 25, 50 and 75% N substituted through neem cake. The content of NH4+-N increased up to 1st day of incubation in soils containing treatments from control to 50% N supplied through neem cake and decreased with progress of incubation. Similarly, soil with 75% N substituted through neem cake showed that NH4+-N increased up to seven days of incubation and decreased thereafter. On the other hand, the increase in NH4+-N content was found up to 28 days in soil with only neem cake and then decreased. The amount of NO3-N increased with progress of incubation in all the soils. The NO3-N content decreased significantly at each incubation period as the proportions of N through neem cake increased from 25 to 100% as compared to soil treated with 100% N through urea.