ABSTRACT:- This study empirically ascertained the impact of inflation on economic growth of Nigeria employing annual time series data collected from Central Bank of Nigeria Statistical Bulletin between 1981 and 2018. The data was modeled and analyzed using Auto Regressive Distributed Lag (ARDL) Model. Other diagnostic test such as; unit root test, test of Normality, Auto correlation test, Heteroskedasticity test and Breusch-Godfrey Serial Correlation LM test were also carried out and they confirmed the validity and reliability of the model employed. Real gross domestic product was employed as the explained variable, while inflation was employed as the explanatory variable and exchange rate was employed as controlled variable. The results elicited from the study suggested that inflation rate had a negative significant impact on economic growth of Nigeria, while exchange rate recorded a negative and insignificant impact on economic growth of Nigeria. This study concluded that inflation is dangerous to the economy of Nigeria as such, must be curbed. The study therefore recommended that effort should be made my monetary authorities in Nigeria to reduce money supply using various fiscal and monetary policy instruments thereby reducing the availability of money in circulation which will in turn reduce inflation rate in Nigeria.

KEY WORDS:- inflation rate, economic growth, exchange rate, auto regressive distributed lag model, Central Bank of Nigeria.