The Debt Sustainability Analysis (DSA) Toolkit is designed to support states to make informed decisions around debt financing. It provides templates that will allow states to take a backwards look at their historical dynamics in terms of debt stock and debt servicing costs, and to analyse the advantages and disadvantages of various forward-looking debt strategies under different macro-fiscal scenarios. State governments should undertake a DSA on an annual basis – the results of which should inform the subsequent budget process in terms of how much a state can afford to borrow in a sustainable manner, and how much their existing debt portfolio will cost to service (including under any macro-fiscal shock scenarios). The toolkit encompasses a set of linked MS Excel templates that allow for relatively simplistic data entry and forecasting. They have been developed based on the learning from various technical assistance interventions. They also include guidance on debt liquidity and solvency ratios that can guide states in their decision-making process. Finally, a number of macro-fiscal scenarios have been proposed which are based on the current risks facing the Nigerian states. Ultimately, the toolkit will support better informed fiscal decision making, and hence, improved value for money in terms of public resources utilization.