Serious deficits on balance of payment in many developing countries have caused external reserve depletion, currency instability, and economic growth deceleration. One of the prominent variables for the surplus or the deficit of the balance of payment is exchange rate. Nigeria is facing unstable balance of payments, Monetary and fiscal authorities in Nigeria embarked on various measures to streamline exchange rate being one of the leading policies to solve this problem. This study seeks to find out how exchange rates affects balance of payments, secondary data where obtained from World Development Indicators (WDI) online database 2021,Natinal Bureau of Statistics Annual report and Central Bank of Nigeria Statistical Bulletin from 1980-2022. Values of Trade Openness (TOP), exchange rate (EXH), foreign direct investment (FDI), Interest Rate (INTR), Inflation Rate (INFL), and balance of payment (BOP) were collected. Data were analyzed using Augmented Dickey Fuller, Phillips Perron and Kwiatkoski-Phillips-Schmidt-Shin Stationarity test and Autoregressive Distributed Lag Model to detect possible long run and short run dynamic relationship between the variables used in the model. The bounds test indicated a long-run relationship among the macroeconomic variables, ARDL results provided evidence that real exchange rate had negative and insignificant effect on the balance of payments in the long-run. The Researcher recommends that monetary and fiscal policies should ensure strict compliance of policies to stabilize the real exchange rate which encourages exports and take care of disequilibrium in balance of payments.