To avoid chances of spreading of diseases, recycling the silkworm litter for generation of bio gas along with cow dung slurry and generation of nutrient enriched compost is the best remedy found and hence a study was made to recycle the silkworm litter as a source of energy for bio gas production. Bio gas plants of 1 cubic metre (Cum) capacity were established at two farmers in Dasarpally village of Hosur Taluk and three farmers in Bagulur village of Denkanikotai in Krishnagiri district of Tamil nadu. The results revealed that a farmer could generate bio gas by using cow dung in combination with silkworm litter in 3:2 ratios by consuming 15 kg of cow dung and 10 kg of silkworm litter daily. By mixing in the above ratio, the farmer could generate 433 m 3 gas per year. This helped to save 1.5 MT of Fire wood, 220 l of kerosene or 11 cylinders (157 kg) LPG-Liquefied Petroleum gas per year with corresponding savings of Rs.4000 to Rs.4520 per year. In addition to the saving of fuel, improved the sanitation surrounding the rearing house resulted in protection of crops from pathogens of protozoan, viral, bacterial and fungal origin. Added to this, conversion of cow dung mixed silkworm litter helped to generate nutrient enriched bio – compost that directly influences on the quality of mulberry leaf and ultimately on quality cocoon. This aspect broadly helped not only in reducing environmental pollution, crop failures due to contamination but also minimizing the expenditure on fuel to the Sericulturists.