[Objective] The external costs and the optimum use of nitrogen fertilizer based on the balance of economic and ecological benefits was studied in the paddy field system of the Dongting Lake area, one of the main food production regions in China. [Method] The environmental impact was economically evaluated. The optimum Uue of nitrogen fertilizer was calculated based on the exterior diseconomy theory and economic benefits were considered. [Result] by using the production function model. Both ecological benefits and farmers' It was calculated the...