The percentage of cultivable area to total area and percentage of irrigated area to total cultivable area are 84.92, 82.81 respectively. This shows that Karaikal  is predominantly an agricultural area. Agriculture is the most important economic activity in the district, both in terms of employment and output. Higher production is due to the existence of the coastal alluvium soil very suitable for the cultivation of paddy and pulses.

In the early days, agriculturists in Karaikal district had to depend on inundation following floods in Cauveri or local rainfall. The main branches of Cauveri below the grand anicut are the Kodamurutti, Arasalar, Virasolanr and Vikramanar. They break again into a number of distributaries and some flow across Karaikal district before entering the Bay of Bengal. Canals are the exclusive means for carrying out irrigation in Karaikal.

 The following are the main sources of water for agricultural purposes.

1. Arasalar
2. Nular - an irrigation supply carrier receiving its supply from Arasalar.
3. Vanjiar - an irrigation cum-drainage carrier fed by Arasalar.
4. Nattar - an irrigation supply carrier fed by Arasalar
5. nandalar - which receives supply from Virasolanar.
6. Pravadayanar - fed by Kodamurutti.
7. Tirumalarajenar - an irrigation cum drainage carrier receiving supply from Kodamurutti.

There are a few shallow tube wells mainly in Tirunallar commune and partly in Neravy and Nedungadu communes for agricultural activities.

Pulses, cotton, Chillies, coconuts, groundnuts, vegetables and sunflower are the other popular items grown in the district. The paddy growing seasons are popularly known as kuruvai, (June-Oct), Samba (Aug-Feb.) and thaladi (Nov- March). Soon after the closure of the southwest monsoon, groundnut is cultivated utilizing available moisture. The major groundnut-growing centre is Kottucherry commune. Pulses are grown in summer following harvest of samba paddy.