Chemical Engineering Department, Visvesvaraya National Institute of Technology, Nagpur-440010 E-mail: shriramsonawane@gmail.com Manuscript Received online 7/10/2020, Accepted 11/1/2020 Increasing the world population requires clean and sustainable energy sources and energy conservation methods. Use of the nanofluids in solar energy devices is one such approach. In this study, we used the Fe2O3 based nanofluids for the absorption of the solar radiation using prototype direct absorption solar collector. The realizable k-�� model in the ANSYS FLUENT V16.2 is used to validate the experimental results obtained. The average error of 8.02% is found after the comparison. 50% enhancement in collector efficiency is recorded during these experiments. Exergy efficiency is recorded 72% more at the 0.035 volume fraction of the nanoparticle concentration and 1.25 lpm flow rate than the exergy efficiency of the water as a base fluid. But the power required to pump this nanofluid is more than the power required in the water as a base fluid. Thus, this study is useful for the scale-up study for further findings.