The performance Bt technology and its impact on farming community have been assessed in northern Karnataka based mainly on primary data processed using production functions, decomposition analysis and logit model. On an average, per farm area under Bt cotton was 2.21 ha, accounting for 66 per cent of the total landholding. With a yield of 24 q/ha, Bt cotton has registered 31 per cent higher yield and 151 per cent higher net return over non-Bt, the net additional benefit being 18429/ha. The non-Bt cotton farmers use chemical fertilizers, organic manures and bullock labour excessively which result in a lower net returns. Technology has been found the major contributor to the total productivity difference between Bt and non-Bt cottons. Seed cost, yield of Bt cotton and cost of plant protection have been found to greatly influence the probability of adoption of Bt cotton. Non-availability of quality seeds and in required quantity have been identified as the most important factors constraining Bt technology adoption. The impact of Bt cotton, as perceived by the farmers, has been in terms of enhanced yield; reduced pest and disease incidence; increased income, employment, education and standard of living; and reduced health risk. To foster adoption, availability of quality and quantity of Bt cotton seed to farmers needs greater attention of development agencies, while researchers’ attention is called for incorporating resistance/tolerance to Spodoptera and pink bollworms.