Synopsis The second most significant source of Islamic teaching and divine injunctions, is Hadith or the tradition of Prophet Muhammed (Pbuh). It means the instruction and sayings of the Holy Prophet Muhammad. Also, the practices, he exercised in his life and asked other to do the same. Hadith, is the prime source of Islamic law-including laws on economy and business-after Holy Quran. Islamic law contains comprehensive principles, valid through the ages in respect of the whole of mankind. The importance of the Islamic economic system distinguishes itself from other systems because it is the system which prepares a person for a complete living. The sources of Islamic economics provide that the systems of Islam is much more concerned about human welfare. The present work covers all the aspects very systematically and orderly in a simple and effective style for all those who are concerned with philosophy and theology, and particularly Islamic studies.