Agricultural mechanization is very important in enhancing farm productivity, efficiency and timeliness of agricultural activities. Tractor is one mechanised input which is recognised as the major source of farm power in modern agriculture. This study was carried out to assess the economic efficiency of various tractor models in the agricultural sector in the market situation in India. The five tractor models i.e. Swaraj 735 FE, Mahindra 575 DI, Sonalika DI 750 III, New Holland 3630 TX and John Deere 5310 were analysed in terms of fixed costs, variable costs, total operational costs, break-even utilization and field efficiency. Fixed costs were defined as depreciation, interest, taxes, insurance and housing while variable costs were defined as fuel, lubricant, repair and maintenance and labour costs. It was decided to use the straight-line method of depreciation with an economic life of 12 years and a salvage value of 25%. It was found that depreciation cost varied from ` 52.40/hr in Swaraj 735 FE to ` 78.30/hr in John Deere 5310 and the total fixed cost ranged from ` 98.60/hr to ` 142.80/hr. Under the assumption of diesel price ` 95/L, the highest share of diesel cost in the variable expenses category was in Mahindra Reva 735 (` 304/hr) and the lowest in Swaraj 735 FE (` 245/hr). The lowest total operational cost was in Swaraj 735 FE (` 549.0/hr) and the highest in New Holland 3630 TX (` 762.3/hr). But, higher horse power tractors showed increased field efficiency and lower operational cost/ha; and the minimum operational cost per ha was ` 1057/ha for John Deere 5310. Break-even analysis showed that a higher annual utilization of the larger tractor is necessary for economic feasibility. The study underscores the need for selecting the optimum tractor and effective utilization of the machines in sustainable and economical agricultural mechanization.