The state of Tamil Nadu, located in South India, has been identified as a state with gender equality as is evident from a balanced sex ratio, higher age of marriage of women, lower fertility rates and higher female literacy. Using district level and village/town level data from Census 2001, we examine the role of different socio-economic factors to explain the gender differentials in sex ratio at the age below six years at following levels: 30 districts, 14,278 towns and 15,363 villages of Tamil Nadu. Our evidence suggests that improvements in female literacy rate and occupational status of male members engaged as agricultural workers or other workers exert a positive impact on the sex ratio. We also document that particularly vulnerable are children of households not belonging to the marginalised castes in the rural area, and also those who are economically relatively better off. Our results are in sharp contrast with the existing evidence on the determinants of sex ratio. The results remain invariant to the model specification even after controlling for unobserved heterogeneity at the district level.