The price of nitrogen (N) fertilizer has increased by 5 fold during the last decade. This has led to a significant decline in net returns. However, the increase in cereal grain price for the same period of time was negligible compared to that of N fertilizer price. Poorly managed N fertilization can cause potential ammonia emission and nitrate contamination of groundwater, in addition to being waste of natural resources. Thus, improving N uptake efficiency in crop production is important to maintain economic and environmental sustainability. We have presented different strategies on efficient use of N and phosphorus (P) via optimizing soil conditions including water management and oxygen fertilization. Our recent research results has shown that at a given N rate and soil temperature, N loss by ammonia (NH3) emission was greater when soil water content was maintained at 20% than that at 80% of field capacity (FC). Flooded corn (genotype: FR27 × FRMO17) seedlings with oxygen fertilization absorbed N 8-fold greater than those without oxygen fertilization. Nitrogen use efficiency of wheat (genotype: Yanzhong 144) seedlings grown in complete nutrient solution was 10-fold greater than that of the seedlings under low-phosphorus stress (P-imbalanced nutrient solution). These results indicate that appropriate soil water management, oxygen fertilization, and supply of well-balanced nutrients significantly reduced N loss and enhanced N uptake and N use efficiencies of corn and wheat.