This chapter discusses foreign direct investment (FDI) by introducing key concepts and frameworks for understanding why FDI occurs and its potential advantages and disadvantages for home and host countries. It defines types of FDI and important FDI terminology. It also outlines different political views on FDI based on perceptions of its costs and benefits, and discusses debates around regulating FDI. The learning objectives are to understand FDI vocabulary, theories for why it occurs, and how it can create advantages through ownership, location and internalization, as well as consider different political stances regarding FDI.