Abstract: Kingdom of Saudi Arabia is a developing country and is rich in natural resources. The export sector plays an important role in the economic growth of a country. Basically, economic growth of a country depends on the nature and type of relationship between exports and domestic economic growth. Modern econometric techniques such as Vector Auto-Regression (VAR), Impulse Response Function (IFR) and the Granger-causality test were applied to determine long-term relationship between exports and domestic economic growth from 1970 to 2005. It was found that the export sector of Saudi Arabia caused a significant effect on the economic growth and a positive influence on other economic activities in the long run. Also, a long-term equilibrium existed among the various macroeconomic variables such as RGDP, RC, RG, RI, RX and RM considered in the study. It is apparent that a steady state condition can be reached between exports and economic growth in Saudi Arabia.