Chemical fertilizers are widely used in modern agriculture. Fertilizers rich in nitrogen (N) are of special attention. However, numerous issues arise when nitrogen fertilizer is introduced into the soil. Significant losses occur due to soil-climate environment as volatilization, nitrification, and subsequent denitrification processes. Different strategies have been employed in the past to cope with the issues. Several organic and inorganic materials are used for the management of N dynamics in the environment with high efficiency. With the increase in temperature and moisture levels, the ammonium and nitrate release was also increased. However, ammonium and nitrate release from coated urea was significantly lower under different temperatures and moisture levels. Coated urea enhanced the growth and yield of crops significantly. Thus, using organic material as coating material had the potential to not only enhance the growth, yield, and nitrogen use efficiencies but also control negative effects on the environment. Issues related to urea utilization efficiency could be managed very effectively by using environmentally notorious materials like neem oil. This will not only lead to more fertilizer use efficiency but also help to manage the environmental problems originating due to ammonia emission and nitrate leaching into groundwater. This approach has the potential to increase the farmer’s income with minimum loss to the environment.