Approximately 70% of shrimp consumed globally is farmed. India is ranked among the top five shrimp farming countries globally, and occurs mainly in the eastern coastal state of Andhra Pradesh (AP). More than 90% of the farms are less than 2 ha and are farmer owned, operated and managed. The objective of this study was to increase our understanding of climatic and socio-economic factors influencing this sector, through a survey of 300 shrimp farmers in AP in 2009/10. The farming communities were divisible into two groups: members of a society/cooperative and those operating individually. The latter were large scale adopting more intensive practices. The average production cost was Indian Rupees (IRS) 80,186 ha^-1 and net income in summer and winter was IRS 221,901 and IRS 141,715, respectively. The mean technical efficiency estimated using Stochastic frontier function was 7% and 54%. The present study attempts to explain the difference in efficiencies using socio-economic and climatic variables, the latter being a novel approach. Among socio-economic variables, farming experience and membership in society were found to have a significant influence to improve technical and economic efficiencies. Further improvements in identifiable facets of the practices and a consequent increase in technical efficiency will make the sector less vulnerable to climatic change impacts.