Mokokchung's economy is predominantly service-oriented, heavily supported by the public sector, education, and retail trade. As a district headquarters, government administration provides a significant portion of formal employment.
The city also acts as a vital commercial hub for the northern districts of Nagaland, including Tuensang, Zunheboto, and Longleng. Trade centers on consumer goods, agricultural products, and locally manufactured items. While the cost of living is moderate compared to major Indian metropolises, transportation costs can elevate the prices of essential commodities brought up from the plains. Economic strengths include a highly educated workforce and a growing niche tourism sector, though large-scale industrial development remains limited due to the challenging terrain and infrastructure constraints.

