Nepal''s targets for economic growth are often ‘wishful thinking'' due to a number of reasons including persistent poverty and educational inequality among others. Many countries including Nepal are committed to providing equal access to education to reduce the educational attainment gaps between various groups for attaining the committed goals of Universal Primary Education (UPE) of Millennium Development Goals (MDGs) and the Goals of Education for All (EFA). In order to attain these goals, a strategic effort with more effective interventions is required for further equitable distribution, which is ultimately required for balanced economic growth. This dissertation has measured educational inequality by calculating Gini coefficient using the dataset of three major household surveys. The findings in terms of educational inequality is then analyzed with the GDP per capita (PPP US$) to assess the relationship between educational inequality and economic growth.