Efficient strategies for phytase production gained increasing importance as more applications require high amounts of phytase for the market. Four phytase-producing bacterial strains isolated from Malaysia’s hot springs were used in this study to determine the effect of nitrogen sources on phytase production. All of the strains were screened out by applying halozone method which shows all of the strains were definitely positive phytase producer. Phytase Screening Medium (PSM) with soybean extract as substrate was used as a cultivation medium. Optimised condition with 1.0 % (w/v) of glucose (as carbon source), pH 5.5 and 37°C temperature was applied. Yeast extract and peptone were used to identify optimum nitrogen source in maximum phytase production. Quantitative analysis observed were optical density, colony forming unit, pH values and phytase activity to identify the effect of nitrogen source in phytase production. The finding was bacterial strain L3 as the best producer in producing maximum phytase (0.2162 U/mL) with optimised condition using yeast extract as nitrogen source. Findings in this study proved that yeast extract act as the optimum nitrogen source which contribute to maximum phytase production as supported by previous studies. This study can provide an efficient strategy to produce maximum phytase as few studies stated that phytase is an application tool in functional food production that consists of myo-inositol phosphates that is believed to have important pharmacological effects.