Although the importance of the external IT environment has been recognized in the literature, there has been little effort to conceptualize the theoretical dimensions of this construct and develop operational indicators to measure it. Our research addresses this gap and seeks to develop the theoretical dimensions and operational measures for external IT environment and empirically validate them. We use qualitative data obtained from interviews with 27 senior IT executives to identify three broad dimensions of external IT environment—namely, IT munificence, IT dynamism, and IT activity intensity. Operational measures for these dimensions were also developed from qualitative research. Subsequently, an instrument was developed to empirically measure the dimensions of the external IT environment. The validity of the dimensions and its operational indicators are being tested with data collected from a survey of 223 IT executives.