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Grounding on institutional theory and e-commerce adoption literatures, the study conducts a cross-country analysis assessing the effects of industrial, governmental and legal factors on global B2B e-commerce diffusion in the years of 2001-02 and 2006-07. The analysis is based on a secondary dataset from the Global Information Technology Report published by the World Economic Forum (WEF). The secondary data analyses cover 75 countries in 2001-02 and 122 countries in 2006-07, reflecting business perceptions of the institutional environments and e-commerce diffusions in those countries. The results of the study indicate that at the infant stage of e-commerce, the supportive government policy was a powerful facilitator for e-commerce diffusion around the world. As e-commerce becomes more prevalent, e-commerce diffusion is more business-driven and the government policy loses its significance. Meanwhile, as companies engage more in e-commerce, the legal environment becomes an important factor in e-commerce diffusion. The study confirms various institutional environments exert influences on countries’ e-commerce diffusion at various stages of e-commerce development. It is one of the first cross-country studies on the institutional environments and the research results have managerial and policy implications for global e-commerce diffusion.