In examining the need for Nigerian economy to encourage the domestic manufacturing sector, this study looks at the effect of imported manufactured goods on the performance of manufacturing sector in Nigeria. The study employed econometric analysis with Ordinary Least Square (OLS) method of data estimation and analysis and Augmented Dickey fuller test to conduct unit root test to ensure the stationarity states of the variables used. The estimated result of model one shows a positive statistically significant relationship between domestic manufacturing sector output and the Nigeria manufactured imports. Model two estimates also indicate that domestic manufacturing sector contributes positively to economic growth of Nigeria. Therefore, the study recommended among other things the use of fiscal policy measures to checkmate or control high importations of goods that can be manufactured domestically to enable domestic manufacturers expand and thus, create employment opportunities for Nigerians.