Public debt, which has escalated to approximately N38.005 trillion by the first quarter of 2024, has become a critical concern for Nigeria’s economic sustainability. The country’s debt service-to-revenue ratio has reached 183%, indicating a severe fiscal imbalance. Hence, this study examined the relationship between debt servicing and foreign exchange rate unification in Nigeria from 1995 to 2023. Using an Autoregressive Distributed Lag (ARDL) model, the research investigated the effect of exchange rate unification, inflation, GDP growth, and oil prices on Nigeria’s debt service-to-revenue ratio. The findings reveal that exchange rate unification has a significant negative effect on the debt service burden, suggesting potential benefits of a unified exchange rate policy. Inflation rates and lagged exchange rates also negatively impact debt servicing, while oil prices show mixed effects. Based on these findings, the study recommends that policymakers continue pursuing exchange rate unification while implementing careful inflation management strategies. Also, the research suggests focusing on economic diversification to reduce oil dependence and improving fiscal discipline to better manage persistent debt servicing commitments.