This study examines how institutional factors influence capital structure and debt maturity choices of firms in 39 developed and developing countries. The authors find that a country's legal and tax system, corruption, and the preferences of capital suppliers significantly explain variations in leverage and debt maturity ratios. Specifically, firms in more corrupt countries and those with weaker laws tend to use more debt, especially short-term debt. Explicit bankruptcy codes and deposit insurance are associated with higher leverage and more long-term debt. Firms in countries with greater tax benefits from leverage also tend to use more debt. The study also explores the impact of industry fixed effects and firm-level characteristics, finding that country-level factors are more important determinants of capital structure than industry factors. The results highlight the importance of legal systems, tax policies, and the financial market environment in shaping corporate financing decisions.This study examines how institutional factors influence capital structure and debt maturity choices of firms in 39 developed and developing countries. The authors find that a country's legal and tax system, corruption, and the preferences of capital suppliers significantly explain variations in leverage and debt maturity ratios. Specifically, firms in more corrupt countries and those with weaker laws tend to use more debt, especially short-term debt. Explicit bankruptcy codes and deposit insurance are associated with higher leverage and more long-term debt. Firms in countries with greater tax benefits from leverage also tend to use more debt. The study also explores the impact of industry fixed effects and firm-level characteristics, finding that country-level factors are more important determinants of capital structure than industry factors. The results highlight the importance of legal systems, tax policies, and the financial market environment in shaping corporate financing decisions.