This study investigates the effect of tax audit and investigation on the revenue generating capabilities of Federal Inland Revenue Services (FIRS), a study of Port Harcourt branch of Federal Inland Revenue Services. The two research questions that guided the research include; to what extent does functional tax audit and investigation department of FIRS influence its revenue generating capabilities; and to what extent does ineffective tax audit and investigation exercises affect the revenue generating capacity of Federal Inland Revenue Service. The population of the study consists of the staff members of the Federal Inland Revenue Service, and professional accountants Port-Harcourt. A Simple random sampling technique was adopted in distributing 100 copies of questionnaire, out of which 80 copies were returned. Presentation and analysis of primary data collected with questionnaire were done using tables and simple percentages. The study revealed that functional tax audit and investigation department, to a considerable extent influences the revenue generating capabilities of Federal Inland Revenue Service. Besides, ineffective tax audit and investigation exercises, to a great extent, weaken revenue generating capacity of Federal Inland Revenue Service. The study recommends the need to strengthen tax audit and investigation department and to ensure its optimal performance, a degree of autonomy should be granted to this department to enable it carry out its responsibilities effectively as specified in Federal Inland Revenue Service Establishment Act 2007.Thorough, regular, effective and efficient audit and investigation exercises should be put in place through the employment of competent professionals considering the importance of tax audit and investigation processes. The study equally concluded that effective and efficient audit and investigation exercises together with functional tax audit and investigation department would strengthen considerably the generating capabilities of Federal Inland Revenue Services (FIRS).