The parametric decay instability of an electron plasma wave in a homogeneous, unmagnetized, hot and collisionless dusty plasma has been investigated analytically. The Vlasov equation has been solved perturbatively to find the nonlinear response of the plasma particles. The presence of the charged dust grains introduces a background inhomogeneous electric field that significantly influences the dispersive properties of the plasma and the decay process. The growth rate of the decay instability through the usual ion-acoustic mode is modified, and depends upon the dust perturbation parameter ${\mathrm{\ensuremath{\mu}}}_{\mathit{i}}$, dust correlation length ${\mathit{q}}_{0}$, and the related ion motion. However, the decay process of the electron plasma wave through the ultralow frequency dust mode, excited due to the presence of the dust particles, is more efficient than the decay through the usual ion-acoustic mode in the dusty plasma. \textcopyright{} 1996 The American Physical Society.