Extended-spectrum β-lactamases (ESBLs) are a group of plasmid-mediated, diverse, complex and rapidly evolving enzymes that are posing a major therapeutic challenge today in the treatment of hospitalized and community-based patients. Extended spectrum beta lactamases hydrolyze expanded spectrum Cephalosporins like Ceftazidime, Cefotaxime which are used in the treatment of urinary tract infections (UTI).A prospective study was undertaken to know the occurrence of ESBL and their antibiotic susceptibility pattern to guide empirical therapy for UTI. Over a period of three months (March 15 to May 15), organisms grown in pure culture and in significant numbers from urine sample were identified by standard biochemical tests and antibiotic susceptibility determined by disc diffusion method. Gram-negative bacilli that were resistant to third generation Cephalosporins were further tested for ESBL production by Combination disk test method. MIC of Ceftazidime, Cefotaxime and Cefepime was determined for ESBL producing Gram negative isolates by an Epsilometer test (E test). Of the 272 isolates, 185(68%) were resistant to third generation cepholosporines. Of these, 116(43%) were found to be ESBL producers. Based on the species79 (50%) Esch. coli, 13 (32%) Klebsiella pneumoniae, 9 (24%) Pseudomonas aeruginosa, 6(43%) Citrobacter freundii, 4(50% Acinetobacter sp, 4(50%) Proteus sp and 1(20%) Enterobacter aerogens harboured ESBL enzymes. Most of the ESBL producing isolates were multidrug resistant. Monitoring of ESBL production and antimicrobial susceptibility testing are necessary to avoid treatment failure in patients with UTI.