Though the South Indian slate of Andhra Pradesh isexperiencing transition to replacement level, notable fertilitydifferentials persist between the caste groups. Fertility has beenmuch higher among scheduled caste and scheduled tribes comparedto other caste groups. This paper examines the fertility differentialsamong caste groups in the context of characteristics and interactionhypotheses, using the second Indian National Family Health Surveydata. The results of multiple classification analysis on cumulativefertility and proportional hazard analysis on birth intervals show thatdifferentials between caste groups persist even after controlling forthe other socioeconomic and demographic variables. Further, theanalysis of interaction effects show that the caste effect is notconstant across the levels of other socioeconomic factors. In ruralareas and at the lower levels of education and standard of living,fertility is relatively high and scheduled castes and tribes havehigher fertility than ?other? caste. But this situation is reversedcompletely in urban areas and at the higher levels of socioeconomicstatus, where the level of fertility is not only low hut also scheduledcastes and tribes have lower fertility than ?other? castes. Thisindicates with the improvement of socioeconomic status, not onlywill fertility decline, but also the difference in fertility between castegroups will disappear.