Two pot experiments were carried out during the two successive seasons of 2010/2011 and 2011/ 2012 to apply mineral nitrogen and/or Azolla at different methods of addition with a reduction of mineral nitrogen fertilizer and its effect on vegetative growth, the yield of inflorescences, total phenolic concentration, antioxidant activity, nitrate and nitrite concentrations and the volatile oil concentrations and composition of chamomile inflorescences in sandy soil. Data indicated that dry Azolla (DA) treatments increased significantly plant height, number of branches/plant, shoot fresh and dry weights and number of inflorescences/plant against the rest treatments. It is clear that DA singly induced maximum growth parameters in both seasons and the reverse was true with fresh Azolla (FA) alone. It is obvious that DA achieved the highest total phenolic concentrations, antioxidant activity and volatile oil (VO) concentrations, and the opposite response was true for nitrate & nitrite concentrations. Addition of 50% ammonium nitrate to 50% FA or 50% Azolla extract as foliar (spray Azolla) SA have positive effect on chemical constituents except nitrate and nitrite concentrations. It is evident that the highest chamazulene and α ̶ bisabolol oxide ̶ B were achieved with DA and the reverse was true for α ̶ bisabolol oxide ̶ A. Dry Azolla treatment alone was the most efficient one in increasing the yield production with increment in active substances of chamomile plant in sandy soil.