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This paper expounds the application and perceived impact of Artificial Intelligence (AI) in academic libraries in Nigeria. Libraries especially in developing countries may become moribund in the 21 century unless they begin to harness new, smart and intelligent technologies for improved operations and service delivery. This research adopted a literature-based approach to x-ray the applications and perceived impact of Artificial Intelligence (AI) in academic libraries in Nigeria. Through a systematic analysis and review of literature, the study brought to limelight the current state of AI integration in academic libraries in Nigeria and its possible impact on library services, collections, users, professionals and general library operations and services. The application of Artificial Intelligence (AI) in academic libraries has the potential to revolutionize library operations and services. Some of the identifies AI tools include: Natural Language Recognition, Robotics, Big Data, Data Mining, Chatbot, Machine Learning, Pattern Recognition and Expert system. Findings from the study revealed that the application of AI in academic libraries have the potentials to increases productivity, improved customer satisfaction through personalization, easy availability and accessibility of information, easy collaboration and knowledge sharing, virtual assistance and chatbots, and ultimately increase overall operational effectiveness. This paper also explored some of the challenges associated with the application of AI technologies in academic libraries in Nigeria such as poor ICT skills and technical expertise, high initial costs of implementation, phobia for job displacement, epileptic power supply, poor maintenance culture, resistance to change, poor network connectivity, privacy and ethical implications, etc. To maximize the potential benefits of AI applications in academic libraries in Nigeria, it is crucial for these libraries to implement appropriate planning, guidelines and regulations on AI use as well as training and retraining of academic librarians to acquire the required ICT skills, knowledge and competence in order to adapt in the present digital and changing library environment.