In this paper we present our work on the usage of lexical resources for the Machine Translation English and Malayalam. We describe a comparative performance between different Statistical Machine Translation (SMT) systems on top of phrase based SMT system as baseline. We explore different ways of utilizing lexical resources to improve the quality of English Malayalam statistical machine translation. In order to enrich the training corpus we have augmented the lexical resources in two ways (a) additional vocabulary and (b) inflected verbal forms. Lexical resources include IndoWordnet semantic relation set, lexical words and verb phrases etc. We have described case studies, evaluations and have given detailed error analysis for both Malayalam to English and English to Malayalam machine translation systems. We observed significant improvement in evaluations of translation quality. Lexical resources do help uplift performance when parallel corpora are scanty.