The thesis aims to examine determinants that account for and promote inward foreign direct investments into 28 transition countries after the collapse of the Soviet Union. While potential benefits from investment flows are well-recognized, they are never guaranteed. Therefore, policies adopted by the governments of the respective hosting countries may have an essential role to play in attracting and sustaining investments to maximize their benefits. The transition countries were divided into three country groupings according to their regional location and they were analyzed separately. Particularly, the differences in size and timing of the accommodated investments within these groups and among them was discussed considering dynamics of investment flows and stocks starting early 1990s. The main motivation sought by investors in each of the region was identified. The empirical part of the thesis aimed at looking whether the investment flows are stimulated by the overall macroeconomic framework or transition specific institutional architecture of these hosting countries. We employed an annual panel data for these countries in transition for 1994-2014 using a fixed effects estimator. The results suggested that while the institutional setup has some significant effect in attracting investments, the macroeconomic environment of these countries seems to be a more influential determinant to stimulate investments.The thesis aims to examine determinants that account for and promote inward foreign direct investments into 28 transition countries after the collapse of the Soviet Union. While potential benefits from investment flows are well-recognized, they are never guaranteed. Therefore, policies adopted by the governments of the respective hosting countries may have an essential role to play in attracting and sustaining investments to maximize their benefits. The transition countries were divided into three country groupings according to their regional location and they were analyzed separately. Particularly, the differences in size and timing of the accommodated investments within these groups and among them was discussed considering dynamics of investment flows and stocks starting early 1990s. The main motivation sought by investors in each of the region was identified. The empirical part of the thesis aimed at looking whether the investment flows are stimulated by the overall macroeconomic framework or transition specific institutional architecture of these hosting countries. We employed an annual panel data for these countries in transition for 1994-2014 using a fixed effects estimator. The results suggested that while the institutional setup has some significant effect in attracting investments, the macroeconomic environment of these countries seems to be a more influential determinant to stimulate investments.