This study examines the roles of firm- and country-specific factors in determining corporate leverage across 42 countries. It finds that firm-specific determinants of leverage vary across countries, contradicting the assumption that these factors have a uniform impact. Additionally, country-specific factors influence corporate leverage both directly and indirectly. Directly, factors such as bond market development, creditor right protection, and GDP growth rate significantly affect leverage. Indirectly, country-specific factors influence the roles of firm-specific determinants, such as the impact of asset tangibility on leverage. The study uses a large dataset of 11,845 firms across 42 countries, covering the period 1997-2001. It finds that firm-specific factors like tangibility, firm size, risk, growth opportunities, and profitability have significant and consistent effects on leverage, aligning with conventional capital structure theories. However, some firm-specific factors are not significantly related to leverage in certain countries. The study also highlights the importance of country-specific factors, such as legal enforcement, creditor/shareholder right protection, and macroeconomic indicators, in shaping corporate leverage choices. The findings suggest that country-specific factors play a crucial role in determining corporate leverage, and that these factors should be considered in capital structure analysis. The study concludes that country-specific factors are important in determining and affecting leverage choices globally, and that they should be taken into account in the analysis of a country's capital structure.This study examines the roles of firm- and country-specific factors in determining corporate leverage across 42 countries. It finds that firm-specific determinants of leverage vary across countries, contradicting the assumption that these factors have a uniform impact. Additionally, country-specific factors influence corporate leverage both directly and indirectly. Directly, factors such as bond market development, creditor right protection, and GDP growth rate significantly affect leverage. Indirectly, country-specific factors influence the roles of firm-specific determinants, such as the impact of asset tangibility on leverage. The study uses a large dataset of 11,845 firms across 42 countries, covering the period 1997-2001. It finds that firm-specific factors like tangibility, firm size, risk, growth opportunities, and profitability have significant and consistent effects on leverage, aligning with conventional capital structure theories. However, some firm-specific factors are not significantly related to leverage in certain countries. The study also highlights the importance of country-specific factors, such as legal enforcement, creditor/shareholder right protection, and macroeconomic indicators, in shaping corporate leverage choices. The findings suggest that country-specific factors play a crucial role in determining corporate leverage, and that these factors should be considered in capital structure analysis. The study concludes that country-specific factors are important in determining and affecting leverage choices globally, and that they should be taken into account in the analysis of a country's capital structure.