The increasing intensity of competition within emerging economies has compelled small and medium enterprises (SMEs) to adopt strategic management approaches capable of sustaining operational efficiency and long-term competitiveness. Among these approaches, cost leadership strategy has emerged as a dominant framework for enhancing productivity, market penetration, and profitability. This study examines the influence of strategic cost leadership on the operational performance of SMEs in Nigeria by synthesizing existing theoretical and empirical studies related to competitive strategy, operational efficiency, and organizational performance. The paper adopts a research and review journal approach through a comprehensive analysis of prior studies on strategic management, resource utilization, competitive positioning, and business performance. The analysis reveals that SMEs implementing structured cost leadership mechanisms experience improvements in operational efficiency, customer retention, production optimization, and financial sustainability. The study further identifies the significance of organizational resources, process innovation, quality management, and strategic alignment in strengthening the effectiveness of cost leadership systems. The findings indicate that cost leadership strategies contribute significantly to operational performance when supported by managerial competence, technology adoption, and resource optimization. However, the implementation process is constrained by infrastructural limitations, inadequate managerial capabilities, and unstable market conditions within developing economies. The paper contributes to strategic management literature by proposing a strategic cost leadership framework tailored to Nigerian SMEs while integrating insights from competitive advantage theory and organizational performance models. The study concludes that SMEs capable of balancing operational cost reduction with product quality and innovation are more likely to achieve sustainable performance outcomes.