The study analyzed the technology based capacity utilization rate in sugar industry in Nigeria in the period
1970 to 2010. Data used in the study were obtained from the sugar firms, publications of the Central Bank
of Nigeria and National Bureau of Statistics. Augmented Dicker Fuller unit root test was conducted on the
specified data to ascertain their stationarity and order of integration. The result reveals that some variables
were stationary at level while some were stationary at first difference. The diagnostic statistics from the
multiple log linear regression on the specified variables confirmed the reliability of the model. The empirical
result reveals that sugar cane price and sugar industry’s real energy consumption have significant negative
relationship with the technology based capacity utilization in the sugar industry in Nigeria. On the other
hand, the wage rate of skill workers, industry’s, real research expenditure, human capital and period of
import substitution have significant positive influenced on the technology based capacity utilization rate in
the industry. Our findings suggest that policy measures aim at expanding the hectares of industrial sugarcane
and increase production of refined petroleum fuel in the country will promote capacity utilization in the
industry. Also policies targeted on the intensification of research and improved worker’s remuneration in the
sub-sector is strongly advocated.