This study investigates the relationship between capital structure and financial performance of quoted deposit money banks in Nigeria, focusing on the period between 2012 and 2021. Capital structure decisions, specifically the balance between long-term debt and equity,play a critical role in determining the financial health and profitability of banks. The study employs Return on Equity (ROE) and Profit After Tax (PAT) as proxies for financial performance, while long-term debt and equity serve as indicators of capital structure. Through regression analysis, the study evaluates how variations in debt and equity ratios affect financial outcomes. The findings reveal that long-term debt positively impacts ROE, suggesting that debt, when managed prudently, can enhance financial returns through leverage benefits. Equity, on the other hand, significantly influences both ROE and PAT, providing stability and reducing the risks associated with financial distress. This study emphasizes the need for Nigerian banks to maintain an optimal balance between debt and equity to maximize profitability and ensure financial sustainability. The results have implications for policymakers and financial managers aiming to optimize capital structure decisions in a challenging economic environment. Future research is recommended to explore the role of short-term debt and liquidity management in banking performance.