The present study was conducted to evaluate the role of periphyton in the improvement of water quality, released effluents, microbial ecology and growth parameters of Litopenaeus vannamei in a semi-intensive aquaculture system. The experiment was performed for 120days in 0.66ha pond with and without addition of substrate i.e. treatment (periphyton based) and control pond (feed based), respectively having a stocking density of 20m−2 (PL 15). The significant (P<0.05) reduction in concentration of total ammonia nitrogen (TAN), nitrite-N, and biological oxygen demand (BOD) were found in substrate treated pond when compared with the control. About 39 genera of phytoplankton belonging to Bacillariophyceae (14 genera), Chlorophyceae (12 genera), Cyanophyceae (10 genera) and Euglenophyceae (3 genera) were found adhered on aquamat. Significant (P<0.05) improvement in the growth parameters of L. vannamei and feed utilization (FCR=1.02) were recorded in the substrate treated pond when compared to control (FCR=1.31). At the end of the experiment, a significant reduction (12%) in the concentration of nitrogen present in the effluents (output water) was estimated in substrate treated pond. Significantly low level of nitrogen content was estimated in the sediment of substrate treated pond when compared with the control. Nitrogenous waste generated for producing one ton of shrimp, got reduced by 25% in the periphyton based aquaculture pond. Moreover, a significantly (P<0.05) low total Vibrios counts (1.14×103CFU mL−1) were enumerated when compared with the control pond (1.53×103CFU mL−1) and ratio of total Vibrios counts (TVC) to total heterotrophic bacteria (THB) in the water of substrate treated pond and control was found to be 10.56 and 28.39, respectively. Higher survival rate (93%) of L. vannamei was recorded in the substrate treated pond in comparison to the control (84.4%). In general, addition of substrate to obtain periphyton significantly reduced nitrogenous waste in the effluent, by converting it into heterotrophic bacterial and algal biomass, improved the culture water quality and growth parameters and survival of the shrimp in comparison to the normal feed based aquaculture system.To evaluate effect of periphyton (aquamat) on water quality, nitrogen budget, microbial ecology and growth performance of Litopenaeus vannamei in a semi-intensive aquaculture system.