Technical Abstract: Drought stress is a major constraint of peanut production affecting both quantity and quality of peanut. Under drought stress conditions, nitrogen fixation in peanut is reduced. Varieties that can maintain acceptable yield and high nitrogen fixing ability are required. Peanut genotypes with difference in degrees of drought resistance may be different in nitrogen fixing ability. The objective of this study was to investigate the effects of drought stress on nitrogen fixation in peanut cultivars with different drought resistance levels. Two experiments were conducted under field conditions in the dry season of 2003 and 2004. A split plot design with 4 replications was used. Three water regimes (field capacity; F.C., 2/3 available water; 2/3 A.W. and 1/3 A.W.) were assigned to main-plots and 12 peanut cultivars were arranged in sub-plots. After planting, soils were inoculated with rhizobium but application of chemical N was not used. After full irrigation from sowing date to 14 days after emergence, the three soil moisture levels were maintained until harvest. Leaf water potential (LWP), relative water content (RWC), nitrogenase activity (acethylene reduction), number of nodules, nodule dry weight, total nitrogen content, fixed nitrogen (N difference method), shoot dry weight and pod dry weight were recorded. The results revealed that peanut lines used in this study have difference in degrees of drought resistance. By using pod yield at 2/3 A.W. as criterion, the lines were categorized into three drought resistance groups, high (ICGV 98348 and ICGV 98353), moderate (ICGV 98300, ICGV 98303, ICGV 98305, ICGV 98308, ICGV 98324, ICGV 98330, Tainan 9 and KK 60-3) and low (Tifton-8). The high drought resistance group tended to have high nitrogen fixation ability, even under drought stress. ICGV 98348 and ICGV 98353 performed well under drought stress and well-watered conditions. In the moderate resistance group, KK 60-3 and ICGV 98300, performed well under drought. The low drought resistant cultivar, Tifton-8, had intermediate nitrogen fixing ability under drought stress.