An experiment was conducted at Annamalai University, India to study the effect of Glomus fasciculatum (AM fungi) with various sources viz., Single Super Phosphate (SSP), Rock Phosphate (RP) and Bone Meal (BM) at levels viz., 0, 18, 27, 36, 45 and 54 kg/ha of phosphorus in peanut variety VRI-2. The per cent root infection by AM fungi were not much influenced by the sources of phosphorus, but significantly influenced by the levels of phosphorus. The root colonization per cent were 92.66, 86.57, 84.31 and 82.30 in plants applied with SSP, RP, BM and control respectively. The phosphorus utilization efficiency, phosphorus uptake and phosphorus concentration of arbuscular mycorrhizae inoculated peanut increased up to 27 kg/ha. The increase in levels thereafter, up to 54 kg/ha did not show significant difference on the phosphorus utilization efficiency, phosphorus uptake and phosphorus concentration of mycorrhizal peanut. The growth parameters of peanut plants although significantly increased up to 45 kg/ha, the yield parameters of peanut significantly increased only up to 27 kg/ha. The study indicates that the dependency of peanut to arbuscular mycorrhizal fungi limited by the levels of phosphorus application. The lower levels of 18 and 27 kg/ha favoured the peanut mycotrophy and augmented the phosphorus utilization efficiency. Phosphorus uptake and phosphorus concentration increased the growth and yield of peanut. Thus, it can be concluded that management for mycorrhizal dependency of peanut helps to reduce the phosphorus application levels up to 21 per cent, thereby saving the input cost on phosphorus fertilizer application.