Fly ash is the residue produced during the combustion of coal, and its disposal is a major environmental concern worldwide. However, fly ash can ameliorate soils by improving their physical, chemical, and biological properties. Hence, we conducted a study to understand the mycorrhizoremediation of different levels of fly ash (2%, 4%, and 6%) by using kodo millet (Paspalum scrobiculatum L.) inoculated with arbuscular mycorrhizal (AM) fungus Rhizophagus fasciculatus under greenhouse conditions. Fly ash amendment at a low level (2%) significantly enhanced AM colonization, spore number, plant growth, nutrient uptake, nutrient-use efficiencies and grain yield of kodo millet. Nevertheless, inoculation of soils amended with 2% fly ash with the AM fungus further enhanced the AM fungal, plant growth, nutrient uptake and yield parameters. Arbuscular mycorrhizal colonization decreased with increasing concentrations of fly ash amendment; however, such decrease was not linear. Our results also revealed a significantly higher plant growth, root/shoot ratios and nutrient contents in kodo millet shoots raised on 2% fly ash amendment and inoculated with the AM fungus at both harvests. Both fly ash amendment and AM fungus inoculation also significantly influenced the number of grains produced as well as the grain weight. Arbuscular mycorrhizal inoculation and fly ash amendment affected K, Ca, Mg, Na use efficiencies. Plant growth and nutrient parameters were strongly related to the extent of AM fungal colonization in the roots. These observations suggest that the inoculation of AM fungi along with low levels of fly ash amendment could be effectively used for the reclamation of low fertile or marginal soils and in turn fly ash could aid in crop production.