A microcontroller based digital slipmeter was developed for agricultural two wheel drive (2WD) tractors. The actual and theoretical speeds of tractor were calculated by measuring the revolutions per minute (RPM) of front wheel and rear wheels, respectively, using optical slot sensors. A microcontroller was programmed to calculate the actual forward speed and wheel slip of the tractor. These measured values were digitally displayed on the tractor dashboard. The slipmeter was fabricated in such a way that it could be mounted on any make and model of 2WD tractor. The slipmeter was rigorously tested in the laboratory as well as in the field with different tractor–implement combinations. A maximum of ±2 per cent variation was observed between measured and indicated wheel slip.