The objective of the present investigation is characterization of ammonia producing bacteria (Bacillus sp.) and its impact on biodeterioration of cupronickel alloy 90:10. It is well known that iron sulphate and molybdenum are good inhibitors used in cooling water system. The role of interaction between inhibitor and ammonia producing bacteria on corrosion of cupronickel 90:10 was studied. Cupronickel coupons were immersed in Chavara rare earth containing backwater for a period of six months. The predominated ammonia producing bacteria were isolated from the six months old biofilm. A total of four ammonia producing Bacillus sp. (AG1-EU202683; AG2-EU202684; AG3-EU202685 and AG4-EU202686) were isolated from the biofilm and identified by 16S rRNA gene sequencing. The corrosion rate of cupronickel in water (System I) was in the range of 0.046mm/year and 0.052mm/year. In the control system II (Chavara water and nitrogen free medium without bacteria), the corrosion rate was 0.008 mm/year whereas in the presence of Bacillus sp. AG1 and AG3, the corrosion rate was in the range of 0.023 and 0.030mm/year. These bacteria fixed atmospheric nitrogen for their cell protein synthesis and converted into ammonia. Ammonia enhanced pH and ammonical solution was formed in the presence of Bacillus sp. that acted as an etchant. The presence of some anodic spots in the presence of bacteria was affected by ammonia and underwent pitting 2 corrosion. The present study reveals that Bacillus sp. encourage intergranular attack without any stress to the cooling water system.