Despite the rise in government expenditure in Nigeria over these years, there are still public outcries over decaying infrastructural facilities, the Nigerian economy is still described as underdeveloped. It seems that rising government expenditure has not translated to meaningful growth and development of Nigerian economy as Nigeria ranks among the poorest in the world. Therefore, the study examined the impact of the impact of government expenditure on economic growth in Nigeria over a period of 1981 to 2019. Specifically, the study sought to: determine the impact of government expenditure on economic growth in Nigeria and evaluate the causality relationship among government capital expenditure, government recurrent expenditure and economic growth in Nigeria. The methods of data analysis were Error Correction Model and Granger Casuality Test. The following are the major findings of the study: government expenditure (GE) has 24 percent positive and insignificant impact on economic growth in Nigeria (t – statistics (0.021831) < critical value (1.694). It implies that a percent increase in government capital expenditure results to 8 percent insignificant increase in economic growth in Nigeria and there is bilateral cause-effect relationship between government expenditure and economic growth in Nigeria, there is bilateral cause-effect relationship between government expenditure and economic growth in Nigeria. The study recommended that government should increase government expenditure by 20 percent as against 8 percent increase in 2018 to investment in infrastructural development especially electricity supply in order to transform effective and efficient growth of the Nigerian economy. Likewise, nation’s resources need to be well managed and properly channeled towards execution of projects that will promote development and growth of the economy.