Using a macroeconomic approach, this work examined the role of foreign private investment (FPI) and capital formation in the economic growth of Nigeria.In order to achieve our objectives, we estimated the model of capital formation and economic growth for Nigeria. We found, that foreign private investment has a negative impact on capital formation in Nigeria. We also found that both foreign private investment and capital formation, in addition to other factors, significantly determine economic growth in Nigeria.Again we found that the long run impact of capital formation and foreign private investment on economic growth is larger than their short run impact. There is thus a long run equilibrium relationship among the variables as the error correction term is significant, but the speed of adjustment is small in both models. We estimated two stage least squares counterpart of the models in order to check for endogeneity bias.Our findings therefore have some policy implications: First, policies that enhance capital formation and FPI inflow do increase economic growth. Second, banking systems credit to domestic economy enhances capital formation and economic growth.