This study investigated the asymmetric impact of Foreign Direct Investment (FDI) on economic complexity in Nigeria from 1992 to 2022, with a focus on both linear and nonlinear relationships. The study revealed that, in the short run, FDI positively influences economic complexity, with significant immediate effects. In the long run, the benefits of FDI appear to be contingent on other macroeconomic factors such as trade openness and human capital development. In exploring the nonlinear dynamics, the NonLinear ARDL model uncovered that positive FDI shocks initially stimulate economic complexity, but these effects are dampened by short-run volatility, leading to significant negative impacts in subsequent periods. Conversely, negative FDI shocks result in an immediate downturn in economic complexity, followed by a recovery and improvement in later periods. This highlights the asymmetric nature of FDI’s influence on the economy. The study also examined the role of human capital, and found out that it has a significant negative impact on economic complexity in both the short and long runs. This may be due to a lag in realizing the benefits of human capital investments or misalignment with economic needs. These findings reveal the importance of not only attracting and sustaining FDI but also implementing complementary policies that enhance human capital, promote trade openness, and strengthen governance in order to foster sustainable economic complexity and growth in Nigeria.