Environmental pollution has increased in developing countries with increasing industrialization/urbanization. Most of industrial units discharge their effluents either in nearby fields or water bodies. One of such industry, a Paper Mill at Fatehpur - Kurali, (Ropar), Punjab is discharging large volumes of effluent daily in nearby water bodies or agricultural lands. In this study, tube well water and effluents samples were collected and analysed for their suitability for irrigation. Soil and plant samples from the nearby fields, where this effluent is disposed were also collected to study their effect on physico-chemical characteristics of soils and plant growth. Water samples were analyzed for pH, EC, CO3, HCO3, Ca, Mg, Na, K, and trace elements. The results indicate that the effluents were highly polluted and not fit for any use. The untreated effluent was not suitable for irrigation purposes as it is characterized by high values of pH (9.9), EC (2.91 dSm-1), SAR (737 mmol-1/2), BOD (190 mg l-1), COD (5080 mg l-1) and Na (1234 mg l-1). Continuous irrigation with untreated effluent having high EC and SAR values will result in the development of sodicity and soluble salts in the soil to such an extent which may prove toxic to plants. High content of Na in the effluent will reduce the infiltration rate of soil and create the problem of soil sickness. The treated effluent was also found unfit for irrigation purpose because of higher values of EC (1.98 dSm-1), SAR (105 mmol-1/2) and COD (1952 mg l-1). The analysis of soil samples further reveal that continuous use of the effluent has increased the pH, EC and Na content of soil. This resulted in reduced plant growth and hence low productivity. The soil pH ranged from 6.5 to 9.0, EC - 0.09 to 0.91 dSm-1, Na - 36.6 to 427.5 mg kg-1 and Fe - 1.74 to 29.16 mg kg-1. Analysis of plant samples revealed that the long term use of this effluent increased Na and K contents and disturbed the anionic-cationic balance in plants which reduced the yield and quality of crops. Slight increase in trace element contents of plants were also observed. Thus, it may be concluded that the continuous use of effluent from paper mills without monitoring will deteriorate the soil health.