Grain yield and malt quality of barley are largely influenced by the specific variety, soil property and applied nitrogen fertilizer rates. Consequently, nitrogen fertilizer application could lead to tradeoff between grain yield and malt quality and grain yield resulting in significant loss for beverage industries and farmers. Thus a field experiment was carried out during 2018/2019 main cropping season on Nitisol at Arsi Zone of Ethiopia to study the effect of grain yield and malt quality response of malt barley (Hordeum vulgar L.) Varieties to different rates of nitrogen fertilizer. Factorial combination of three malt barley varieties (Holker, Ibon and Fanaka) and five rates of nitrogen fertilizer (11.5, 23, 34.5, 46 and 57.5 kg N ha-1) were laydown in split plot arrangement Nitrogen fertilizer rate as main plot and varieties as sub plot replicate three times. Data on soil sample analysis results revealed that, the soil physic-chemical property didn’t show significant variation in both before planting and after harvest. The interaction effects of nitrogen fertilizer rate and varieties had significant influence on grain yield, thousand kernel weight and hectoliter weight. Malt extract content and germination energy were significantly affected by main effect of malt barley varieties, while grain protein content affected only by nitrogen rate. Thus application of 57.5 kg N ha-1 to Ibon malt barley variety produced better (2.629 t ha-1) grain yields at the study area. From this point of view it can be conclude that Ibon Varity fertilized with 57.5 kg N ha-1 was found to be better in terms of both yield performance and economic feasibility for malt barley production in study area.