The present study was undertaken to find out the cost and returns of milk production in Bhilwara district of Rajasthan with a sample of 60 households. Milk production in India is mainly concentrated on small farms in rural area as a subsidiary occupation to agriculture. Dairy plays an important role to improve the economy of small milk producer’s households in different regions of India. India is leading country in milk in world with production of 176.35 million tonnes in 2017-18 and Rajasthan is the second largest milk producing state with 834 gm/day in the country. The results of study revealed overall average net cost per day was ₹ 154.09 for crossbreed cow, ₹ 106.20 for local cow and ₹ 136.36 for buffalo, respectively. The cost of milk production per litre for crossbreed cow, local cow and buffalo were found as ₹ 22.05, ₹ 33.29 and ₹ 29.26 respectively. The gross return was recorded as ₹ 202.48 for crossbreed cow, ₹ 114.84 for local cow and ₹ 194.05 for buffalo, respectively.