Onion (Allium cepa L.) is a high cash value crop with a very shallow root system that is frequently irrigated and fertilized with high N rates to maximize yield. Converting from furrow-irrigated to drip-irrigatcd onion production may reduce N fertilizer needs, water inputs, and NO3-N leaching potential. Onion growth and N uptake, fresh yield, and residual soil NO3-N were determined under drip and furrow irrigation on a clay loam soil with N fertilizer rates from 0 to 224 kg N ha(-1). Onions were sampled bi-weekly from 25 May to 30 August in 2005 and 2006 from each treatment. In 2005, 72% less water was applied with the drip system compared with furrow system, and 57% less in 2006. Onion yields were significantly greater with the drip system. Total marketable fresh onion yield increasedwith increasing N rate in 2005 only.The drip system had more colossal and jumbo sized onions and less medium sized onions than the furrow system. Biomass production and N accumulation accelerated in mid-June each year with an average total N accumulation (leaves + bulbs) of 121 kg N ha(-1) at final harvest. Irrigation water use efficiency (IWUE) and N use efficiency (NUE) were higher with the drip system than with the furrow system. Residual soil NO3-N levels were greater in the drip-irrigated treatments after onion harvest in 2005 than in the furrow-irrigated treatments, but soil NO3-N levels were similar after harvest in 2006. Adjusted gross economic returns (less the cost of N, water, and drip system) were greater with drip irrigation than with furrow irrigation. This study demonstrates that fresh onion yields, potential economic returns, IWUE, and NUE can be improved in Colorado by using drip irrigation for onion production rather than furrow irrigation.