Signatories of the Kyoto Protocol are obliged to submit annual accounts of their anthropogenic greenhouse gas emissions, which include nitrous oxide (N
2
O). Emissions from the sectors industry (3.8 Gg), energy (14.4 Gg), agriculture (86.8 Gg), wastewater (4.4 Gg), land use, land-use change and forestry (2.1 Gg) can be calculated by multiplying activity data (i.e. amount of fertilizer applied, animal numbers) with simple emission factors (Tier 1 approach), which are generally applied across wide geographical regions. The agricultural sector is the largest anthropogenic source of N
2
O in many countries and responsible for 75 per cent of UK N
2
O emissions. Microbial N
2
O production in nitrogen-fertilized soils (27.6 Gg), nitrogen-enriched waters (24.2 Gg) and manure storage systems (6.4 Gg) dominate agricultural emission budgets. For the agricultural sector, the Tier 1 emission factor approach is too simplistic to reflect local variations in climate, ecosystems and management, and is unable to take into account some of the mitigation strategies applied. This paper reviews deviations of observed emissions from those calculated using the simple emission factor approach for all anthropogenic sectors, briefly discusses the need to adopt specific emission factors that reflect regional variability in climate, soil type and management, and explains how bottom-up emission inventories can be verified by top-down modelling.