The paper examines the role of distance in institutional quality as a determinant of Korea’s outward foreign direct investment. Using a panel data sample of 71 host countries covering 2002 to 2015, we identify institutional indicators that matter for attracting FDI from Korea. The results of the dynamic panel estimation show that Political stability and absence of violence distance, Government Effectiveness distance between Korea and host countries are the most relevant institutional quality dimensions in attracting Korea’s outward FDI. In addition, the market size, trade openness, and educational level of human capital have significant positive effects while geographic distance has a negative impact.