India contributes one fourth of world production of capsicum with an average annual production of 0.9 million tons from an area of 0.885 million hectare with a productivity of 1266 kg per hectare. Andhra Pradesh stands first in area 236.5 thousand ha with a production of 748.5 thousand tons, while Karnataka stands second in area (76 thousand ha) with a production of about 131thousand tons. The cost of establishment of capsicum production under protected condition was ` 2,51,109 per unit (0.25acre). The total cost of cultivation of capsicum production under protected conditions was ` 55,080 per units. The total variable cost was ` 20,374 per unit. Among the variable costs, the labour cost was highest (` I0,291), followed by expenditure on material cost(` 8,487). Among the total cost of cultivation, the proportion of total fixed cost was highest (` 34,707) compared to total variable cost (` 20,373). The total yield of capsicum production under protected conditions was 5.50 tons per unit. The total returns and net returns from capsicum production under protected conditions were ` l,54,734 per unit and ` l,15,279 per unit, respectively. The B: C ratio of capsicum production under protected conditions was 3.92.