Abdullahi, Salau Modibbo2023-12-142023-12-142010-06-12Egbe, J.E. (2005), Fiscal Federalism and Its Implications for National And Stability in Nigeria (ed) by Warisu on Police Reform Conference, Federalism and Nations Question in Nigeria- Published by The Nigerian Political Science Association (2005). Elaigu, J.I. Sawa, P.C. Logams and H.S. Galadima (eds) Federalism and Nation-Building in Nigeria: The challenges of the Twenty Frist Century. Abuja: NCIR, 1994. Elaigwu, J.I and Akindele R.A. (1995), Ed, Foundations of Nigerian Federalism series: Vol. 3 Institute of Governance and Social Research Jos, Plateau State. Emeka, Obi A. (2004), Issues in the Theoretical Foundations of Federalism of Federalism and National Integration in Nigeria by Obi E.A and Obikeze S.O (2004). Fajana, O. (2001) Three and A Half Decades of Fiscal Federalism in Nigeria Published in Foundation of Nigerian Federalism. Series. Vol. 3 Institute of Government and Social Research. Jos, Plateau State Nigeria. Jinadu, L.A (1979) -‘A note on the Theory of Federalism” of Akinyemi, A.B, Cole, P. Louis, A.M (2016), The Politics of Fiscal Federalism in Nigeria: An Appraisal of the Principle of Derivation-Post-Graduate Degree Dissertation Submitted to the Department of Political Science, Nasarawa State University, Keffi. The 1999 Constitution of the Federal Republic of Nigeria. Wheare K.C (1953), Federal Government 4thed, Oxford University Presshttps://keffi.nsuk.edu.ng/handle/20.500.14448/6961The Nigerian federalism has been facing a lot of challenges on how to share and disburse national resources in terms of what goes to each of the component units of the federation. Several efforts were made towards having an acceptable revenue allocation formula yet, an acrimonious agitations abound. This is not only in Nigeria but also in so many federal states. In Nigeria, the challenge of fiscal federalism is not only on how to allocate revenue from the central government to units but also, on how to generate the revenues. Toddy, every component unit of the federation is dissatisfied with the revenue sharing formula. Currently, the 13% derivation allocated to oil producing states from the revenue generated from oil has been contentious even among the beneficiaries, which lead to the agitation for resource control. The intense politics associated with revenue generation and allocation has been a serious challenge to the stability' of the nation. What are the factors responsible for this? How can these issues be addressed, so as to achieve a stable federal state in Nigeria? This paper will employ a descriptive and analytical method to interrogate the factors responsible for this ugly challenge. To properly have a grasp of the concept of federalism.enFederalism and Fiscal FederationArticle