This study identifies and analyzes the determining factors and implications of Malaysia's involvement in South-South Cooperation between 1986 and 1996. By focusing on Malaysia's foreign policy under Dr. Mahathir Mohamad, in particular Malaysia's relations with other developing nations, it addresses four critical the factors that influenced Malaysia's interactions with developing countries and the implications of the relationship to both parties; the impacts of Mahathir's leadership on the country's involvement in South-South cooperation; the factors that influenced Mahathir's involvement in articulating North-South issues and the implications of his actions; and the prospects and problems of Malaysia's economic relations with developing countries, particularly with the Indochinese and South Pacific countries. The significance of this study lies in the fact that there has not been any thorough study on Malaysia's involvement in South-South cooperation; the study thus makes a much-needed contribution to the study of Malaysian foreign policy, particularly on its relations with Third World Countries.