Integrated applications of organic and inorganic nutrient sources are indispensable for enhanced nutrient use efficiency and crop yields. However, it requires determination of the optimum combination of these resources based on soil type, crop species, and location. Cognizant of this fact, an experiment was conducted to determine the optimum levels and combinations of compost and inorganic N fertilizers for maximum profitable grain yield of wheat at Melkassa under irrigation in 2014. The experiment involved factorial combinations of four rates of N (0, 23, 46 and 69 kg ha-1) and four levels of compost (0, 5.6, 11.2, and 16.8 t ha-1) laid out in RCB design with three replications. The results revealed that both chemical N and compost and their interactions significantly and positively affected the yield of wheat and N uptake. The highest grain yield was obtained from the combined applications of chemical N and compost than that obtained from N and compost applied alone. Accordingly, combinations of 69 kg N ha-1 and 5.6 t ha-1 produced optimum grain yield and realized the maximum net returns of wheat. Significantly, higher N uptake was obtained from the combined application of N and compost than that obtained from either source applied alone. Therefore suggested that combination of 69 kg mineral N ha-1 and 5.6 t ha-1 compost are the best combination to achieve sustainable yield.