The currency of the UAE is the United Arab Emirates dirham (ISO code AED, symbol د.إ), which is divided into 100 fils and pegged to the US dollar at a fixed rate of 3.6725 dirhams to one dollar. The dirham is the sole legal tender across all seven emirates, including Dubai, Abu Dhabi, Sharjah, Ajman, Umm Al Quwain, Ras Al Khaimah and Fujairah, and is issued by the Central Bank of the UAE.
The Dirham and Its Dollar Peg
The most important thing to know about the UAE dirham is its stability. Since November 1997, the Central Bank of the UAE has held the dirham at a fixed exchange rate of 3.6725 to the US dollar. This peg means the value of the dirham almost never moves against the dollar, so 1 USD is consistently worth about 3.67 AED, and roughly 100 USD converts to around 367 AED.
For visitors and businesses, the peg removes the guesswork that comes with floating currencies. There is no need to watch daily exchange-rate charts or worry about a holiday budget being eroded by sudden swings. Because so much of the UAE's economy is built on oil exports priced in dollars and on international trade, tying the dirham to the dollar gives the country predictable pricing and reassures the global investors and companies that have made Dubai and Abu Dhabi major commercial hubs.
How the Dirham Is Divided
One dirham is made up of 100 fils. In everyday life, though, the fils plays a small role. Prices are usually quoted in whole or half dirhams, and the smallest fils coins are rarely seen in circulation. The coins you will actually handle are the 1 dirham, 50 fils and 25 fils pieces; the tiny 10, 5 and 1 fils coins technically exist as legal tender but are seldom used and are often rounded away at the till.
Banknotes carry the bulk of cash transactions. The dirham circulates in denominations of 5, 10, 20, 50, 100, 200, 500 and 1,000. Each note has a distinct color to make it easy to tell apart at a glance, and the higher-value notes such as the 500 (blue) and 100 (pink) feature national landmarks, including the Burj Khalifa, the world's tallest building.
A Short History of Emirati Money
The dirham is younger than many travelers assume. Before the United Arab Emirates was founded in 1971, the territory used a patchwork of currencies, including the Gulf rupee and later the Qatar and Dubai riyal. To unify the new federation's monetary system, the UAE dirham was introduced in 1973, replacing the riyal at par.
The name itself is ancient, descending from the Greek drachma by way of Arabic, a reminder of the region's long history as a crossroads of trade. In recent years the Central Bank has modernized the currency, rolling out a fresh series that includes durable polymer notes printed with contemporary national imagery. This redesign reflects the UAE's rapid transformation from pearl-diving and trading ports into one of the world's most futuristic economies.
Paying for Things in the UAE
The UAE is one of the most card-friendly destinations in the world. Contactless payment is accepted almost everywhere, from luxury malls and hotels to supermarkets and coffee shops, and mobile wallets such as Apple Pay and Google Pay are widely supported. Many visitors get through an entire trip barely touching physical cash.
That said, a small amount of dirhams is still handy. Traditional souks, some independent taxis, smaller neighborhood shops and street-food vendors may prefer or only accept cash. ATMs are plentiful in cities, airports and malls, and they dispense dirhams directly from international cards. Because of the dollar peg, US travelers find budgeting unusually simple, though it is worth remembering that the UAE, and Dubai in particular, can be an expensive place to visit. Tipping is not mandatory since many bills include a service charge, but rounding up or leaving around 10 percent is appreciated. For more on visiting the country, see our united arab emirates country guide.
Why the Dirham Matters Regionally
Beyond its borders, the dirham underpins the UAE's role as a financial and logistics gateway between East and West. Dubai's gold and commodities markets settle enormous volumes of trade, and the city's status as a global tourism magnet, welcoming tens of millions of visitors a year, keeps dirhams flowing through hotels, retail and aviation. The currency's reliability is a quiet but central ingredient in that success. A stable, fully convertible money makes it easy for airlines, traders, expatriate workers and multinational firms to operate without currency risk, reinforcing the UAE's position as one of the most connected economies in the Middle East.
Frequently Asked Questions
What is the currency symbol for the UAE dirham?
The dirham is written as د.إ in Arabic and commonly abbreviated as AED or Dhs in English. Its official ISO 4217 code is AED, which stands for "United Arab Emirates Dirham."
Is the UAE dirham the same in Dubai and Abu Dhabi?
Yes. The dirham is the single official currency for the entire federation, so the same notes and coins are used in Dubai, Abu Dhabi and all the other emirates. There is no separate "Dubai currency."
How many dirhams equal one US dollar?
Because the dirham is pegged to the dollar, 1 USD equals approximately 3.67 AED (the exact fixed rate is 3.6725). This rate has held steady since 1997, so it rarely changes.
Can I use US dollars or euros in the UAE?
Some hotels and large tourist outlets may accept foreign cash, but the dirham is the official tender and you will get better value paying in AED. Exchanging money at the many licensed exchange houses or withdrawing dirhams from an ATM is straightforward and competitive.