Chemical fertilizers are imported to increase crop production in the country. But, the farm produced animal dung is being used as cooking fuel in large quantity. This paper compares the loss of plant nutrients due to burning of dung with the import of chemical fertilizers. The factors affecting the decision of the households to use dung as the main cooking fuel are assessed using household data from Nepal Living StandardSurvey (2003/04) with a probit model. Female education is found to reduce the use of dung fuel. Reduction of dung fuel burning benefits environment, women and the poor.