A field trial on Melia azedarach based Agroforestry system was initiated at Main Agricultural Research Station, University of Agricultural Sciences, Dharwad on medium black clay soil under rainfed conditions during 2002. The experiment consisted four spacing viz, 5m x 1m, 5m x 2m, 5m x 3m and 5m x 4m. Soybean (JS - 335) crop was grown in the interspace of Melia azedarach rows during Kharif every year. Recommended package of practices were followed for soybean. Fertilizer dose of 100:50:100 NPK kg/ha was applied to Melia azedarach in the initial four years. All the silvicultural practices were followed for better development of Melia azedarach. At the end of 10th year the soybean yield were significantly decreased in 5m x 1m and 5m x 2 m spacing of Melia azedarach as compared to 5 x 4m spacing. The diameter at breast height was significantly higher in wider row spacing viz., 5m x 4m as compared to 5m x 1m spacing. The net returns and B:C ratio were significantly higher in Melia azedarach at 5m x 4m soybean followed by at 5m x 3m + soybean as compared to the other treatments. Hence, it can be recommended that 5m x 4 m is suitable under rainfed conditions. It can be recommended for planting on bunds / canal / nala etc.