1. Neem kernel meal (NKM) was incorporated into a standard layer diet at 0, 100, 150 and 200 g/kg, replacing parts of the soyabean meal and deoiled rice bran. Each diet was offered to 18 White Leghorn layers (25 weeks, 50% egg production) in individual cages for a period of 12 weeks. 2. Results indicated significantly lower food intakes (P < 0.01), rates of egg production and egg weights in birds fed on the diets with NKM at 150 and 200 g/kg. Fertility and hatchability were also adversely affected by the higher inclusion rates of NKM. 3. Except for lower egg shell weight and shell thickness (P < 0.05) in hens fed NKM at 150 and 200 g/kg, the internal egg quality characteristics were comparable in all groups. 4. Feeding NKM beyond 100 g/kg to laying hens significantly (P < 0.01) reduced the content of haemoglobin, erythrocyte count, packed cell volume, serum calcium and uric acid concentrations. However, the leucocyte count, plasma glucose concentration and serum glutamate oxaloacetate transaminase activity were unaltered. Serum glutamate pyruvate transaminase activity was significantly (P < 0.05) reduced in birds fed NKM at 200 g/kg. 5. Thus NKM at 100 g/kg in a layer diet would appear to be safe and cost-effective.