The effects of conversion of an Indian dry tropical forest ecosystem into savanna, on mineral nitrogen (N), net N-mineralization rate and microbial biomass carbon (MBC), nitrogen (MBN) and phosphorus (MBP) in soil were studied for two years. There was a marked seasonal variation in all the above parameters at both (upper, 0-10 cm and lower, 10-20 cm) the soil depths of forest and savanna ecosystems. In forest ecosystems the mean annual values of mineral N, net nitrification rate, net N-mineralization rate, MBC, MBN and MBP at both depths were 17. 41 respectively. The soil microbial biomass was positively related to root biomass and total plant biomass (i.e., above-and below-ground biomass). Interestingly, seasonal soil moisture and temperature are reciprocally related to microbial biomass and mineral N and directly related to nitrification and N-mineralization. The microbial biomass, nitrification and N-mineralization are negatively related to clay content. Savannization caused significant loss of soil mean organic carbon (OC), total N (TN) total mean annual nitrification, N-mineralization, MBC, MBN and MBP by 40,42,27,27, 29 and 7%, respectively at upper soil depth and 18,21,42, 29 and 22%, respectively at lower soil depth. The reflectances of soil microbial biomass to OC were 1.22 and 1.06 folds at upper and lower soil depths, respectively.Thus, conversion of dry tropical forests into savanna affects remarkably the soil N transformation; microbial biomass and loss of soil organic C which adds to the environmental pollution.