An exergetic analysis has been performed on a gasification-based bio-hydrogen generation system consisting of an ASU (air separation unit), a gasifier and a water gas shift reactor. The biomass feed in the system is rice straw. The influences of oxygen percentage in the gasifying agent (in the range 85–99%) and gasifier equivalence ratio (in the range 2–4) on the system exergetic efficiency have been studied. The analysis also investigates the effect of the above mentioned operating parameters on the hydrogen yield and cold gas efficiency. It is observed that, with 95% oxygen in the gasifying agent and with gasifier equivalence ratio of 4.0, the process generates 107.8 g hydrogen per kg of dry biomass (on ash free basis) with a cold gas efficiency of 70%. An increase in gasifier equivalence ratio is found to increase the exergetic efficiency of the system. However, the exergetic efficiency remains almost immune to the change in oxygen percentage in the gasifying agent. The maximum destruction of exergy, in quantitative term, is found to be in the gasifier due to the irreversible chemical reactions occurring there. However, in terms of percentage of exergy input, the highest exergy destruction and exergy loss are observed to occur in the ASU.