Fish farming in open water cages in India was initiated through the front line demonstrations of Central Marine Fisheries Research Institute (CMFRI). Cage farming of high value finfishes gained widespread popularity in different maritime states of the country after the introduction of low cost cages and development of seed production techniques for high value finfishes. The farmers in the coastal areas of Kerala state were the pioneers in adopting cage farming in the brackishwaters in the country. The resource use efficiency of cage fish farming was analysed based on data collected from 60 farm units in Kerala state. The resource use efficiency is an indicator of how the various inputs are efficiently used in a farming activity to achieve the maximum economic benefits. The selected farms varied with respect to dimensions of cages, types of fishes cultured, stocking density and feeding. Asian seabass, pearlspot, tilpaia, redsnappers and caranx were the major species cultured in the study area. The average size of a farm unit was 115 m3 with a stocking density of 32 fishes per m3. The yield and revenue per farm were 2.09 t and ₹9,90429 respectively. The net profit was ₹4,99,957 with net benefit earnings ratio of 0.5 and operating ratio of 0.42. Among the cost components 56% of the operational expenses was incurred for feed followed by seed cost(21.9%). The average cost of fish production and price per kg of fish was ₹ 235 and ₹474 respectively. The benefit- cost ratio was 2.02 with return on investment of 241%. Resource use efficiency analysis using Cobb-Douglas production function indicated that stocking density and quantity of feed used had positive and significant influence on fish production whereas farm size was non-significant. The ratio of marginal value product to marginal factor cost was more than unity for seed (7.91) and feed (10.54) indicating under utilisation of inputs in the selected cage farms and there is scope to enhance profit by increasing these inputs.