Financial statements audit is a monitoring mechanism that reduces agency problem between management and the stockholders, and protect the interest of other stakeholders. This critical role of external auditor promotes the quality of accounting information; however, there is a growing concern by the regulators, investors and the general public over the credibility and integrity of audited financial statements and stakeholders’ confidence in auditors’ independence as a result of recent accounting and audit scandals in different part of the world involving earnings management. In Nigeria, there are series of default and failures in the banking sector that are connected with the management and most of the failures are not reported by the auditors but rather by the CBN. This have questioned the integrity and quality of audited financial statements of Nigerian banks, as well as the independence of external auditors on whether they are independent of management influence via audit fees and tenure. This study thus examines the effect of auditors’ independence (using total audit fees, large reputable audit firm and audit firm tenure) on earnings management of the Deposit Money Banks in Nigeria. Correlation research design was employed and Ordinary Least Square (OLS) technique was used in the analysis of the secondary data collected from a sample of 14 banks for a period of seven years (2006-2012). The study found that total audit fees have significant positive effect on the earnings management (discretionary loan loss provision) at 99% confidence level. It is also found that audit firm tenure has a significant positive effect on earnings management at 99% confidence level too. The study concludes that total audit fees and lengthy auditor tenure are a mechanism through which management influence auditors to compromise their independence in the deposit money banks of Nigeria, and therefore allow unethical practices such as earnings management. The study recommends among others that the regulators of the Nigerian banking industry should improve the safeguards for mitigating independence risks; these should include corporate governance, regulatory oversight, auditing firm policies and culture, and individual auditor characteristics.