A field experiment was carried out at the Experimental Farm of Sakha Agricultural Research Station in Kafr El-Sheikh Governorate, Egypt. The experiments were conducted to study the effect of nitrogen fertilizer levels, compost extract, and inoculation with free-living di-nitrogen-fixing bacteria as well as their interaction, on soil properties, onion yield, and quality during the 2009-2010 and 2010-2011(winter seasons). The results showed that the soil-available nutrients (NPK) and organic matter (OM) contents as well as total bacterial counts were increased in the plots treated with compost extract as soil application and application of nitrogen fertilizers at 214kg N ha(-1). Soil salinity and pH were decreased under soil application of compost extract as compared with the foliar applications of compost extract. Growth and onion bulbs yield and its quality were higher due to application of compost extract three times, 40, 60, and 90 days after transplanting (DAT), and two times, 40 and 60 DAT, each at the same dose compared to all other treatments. Inoculation of onion plants increased the bulb dry weight by 18.6% and 19.2% during the 2009-2010 and 2010-2011 seasons, respectively, compared to uninoculated seeds. Based on the results of the current study, the combination of 214kg ha(-1) mineral N and biofertilizers could be considered as an integrated nutrient management to improve soil properties and onion yield.