Dependence on floating diets limits the development of African sharptooth catfish, Clarias gariepinus farming because they are more expensive, require specialized facilities to produce and arguably inappropriate based on bottom feeding behaviour of the species. This study evaluated the effect of floating and sinking diets on the growth performance, feed conversion efficiency, condition factor, yield and cost-effectiveness of C. gariepinus. Fingerlings of 14.95 ± 0.24 g initial mean weight (± standard error) were reared in triplicate earthen ponds at a stocking density of 10 fish m-2 for eight weeks. The results showed that, feeding C. gariepinus using either floating or sinking diets did not significantly affect growth and survival rate (p > 0.05). Equally, C. gariepinus fed on sinking and floating diets had similar feed conversion efficiency (p = 0.426). The fish in both treatments had similar condition factors and were growing isometrically (p > 0.05). Rearing C. gariepinus either on floating or sinking diets did not affect gross, net and annual yields (p > 0.05). However, C. gariepinus fed on floating diet had significantly higher incidence cost by 33% more than feeding them on sinking diet (p = 0.001). Furthermore, the profit index for C. gariepinus fed on the floating diet was significantly lower by 35% less than those fed on the sinking diet (p = 0.001). The present study indicates that, C. gariepinus farmers can reduce feeding cost up to more than 30% by using sinking diet without affecting the growth performance, survival, nutrient utilization, condition factor and yield of their fish.