This study was carried out to identify factors influencing choice of fishing location and profitability to understand dynamics of fishing effort allocation in Malawian artisanal fishers. A semi-structured questionnaire survey was administered to 99 Gillnet and 101 Chilimira fishers in Nankumba Peninsula in Mangochi District. Logistic regression was used to determine the factors influencing choice of fishing location. The study shows that 92.1% of Chilimira fishers are operating in offshore areas while 69.7% Gillnet fishers are operating in inshore areas. Chilimira offshore fishers have higher daily average gross margins than their inshore counterparts and Gillnet fishers. However, they incurred more operating costs than the inshore Chilimira and Gillnet fishers despite the higher returns to labour. The study concludes that artisanal fishers in Malawi use a complex criterion of biological, technological, personal and economic factors and time in deciding where to fish. The study recommends that government and all stakeholders must adapt fisheries development initiatives to the economics driving artisanal fisher's effort allocation to curb overfishing in the inshore areas.