This study was conducted by composting and applying nitrogen to utiliize bag-asse as a substrate which would be equal to peat medium for factory-cultivatedvegetable seedlings. The results showed that:(1) with basal fertilizer(1.0g of NH4NO3,2.0g of KH2PO4, 0.2g of K2SO4 and 0.6mg of micronutrients per liter) and additi-onal application of N by2,1.5,1.0 times respectively, bagasse composted for 3,6,and 9 months was equal to peat medium; (2) only basal fertilizer was needed forthe bagasse when composted for 12 months;(3) increasing the composting volumemade bagasse more effective as a growth substrate;(4) after being dressed with two-fold nitrogen,and with O.5kg of urea per 100kg added the bagasse composted for2 months was equal to peat medium;(5) after being dressed with additional 5.84gof urea formaldehyde per liter medium as basal fertilizer,the bagasse composted for2 months was equal to peat medium.