Biogas is one of the promising sources of alternate energy at farm level. The main raw material used for biogas production is cattle dung and most of the biogas plants installed in India are operated at 10 per cent total solids concentration. To achieve this, equal quantity of water should be added with dung and this large quantity of water required for operation of biogas plants is a major constraint in propagation of biogas technology in rural areas, particularly in water scarce regions of the country. Also, handling and management of digested slurry under field conditions are the main problem faced frequently. To overcome the above said problems, a study was undertaken to evaluate the performance of cattle dung in solid-state in fixed dome type biogas plant under water scarce region. The results indicated that the cumulative gas production of 13.35 m3/m3 was recorded for the entire retention period of seven weeks. The average gas production per day for the retention period from third week to seventh week was observed to be 0.38 m3/m3/day. On an average 0.202 m3 of biogas /kg dry matter was produced with an average methane content of 60 per cent. The results also showed that the nitrogen, phosphorous and potassium contents of digested slurry were higher than that of fresh cattle dung, which indicated that solid-state digestion of cattle dung results in rich nutrient fertilizer. The benefit-cost ratio of biogas plant worked out to be 1.49:1.