Dividend policy is an important issue of corporate finance and this study investigates the relationship between firm dividend policy, ownership structure and board composition of 125 non financial firms listed at Karachi Stock Exchange by using 1375 firm-year observations covering period from 2003-2013. For this objective, two models are developed. In first model block holder’s ownership (owners having more than 10% of a firm’s shares) irrespective of their nature with board specific and firm’s specific control variables are examined. In second model shareholder’s identity is defined as insider ownership, financial institutions and individual investors’ ownership. For further analysis of insider ownership, sample is divided into three levels. The panel data estimation method is used in the study whereas Random Effect Model and Tobit model better explains the results. The results indicate that the dividend policy is positive and significantly affected by block holder’s ownership, board size and audit quality, firm size, profitability and growth opportunities but positively insignificant with managerial share ownership, institutional ownership and CEO duality. Whereas, a significant negative association of dividend policy is observed with individual’s ownership and leverage. The study also reveals a non linear relationship between insider ownership (MSO) and dividend policy i.e. as at low level (MSO25%) a significant positive relationship is documented. This hypothesis explains the managerial entrenchment hypothesis as at high level of insiders’ ownership dividend payments increases which supports free cash flow theory (Jensen, 1986) and resource extraction hypothesis. Whereas, when insiders’ ownership increases up to concentration level (MSO> 50%) it results expropriation of minority shareholders’ rights. Business group affiliation (ASSO) also reveals a significant negative relationship with dividend policy. These findings demonstrate that ownership structure and board composition are important variables that can influence the corporate dividend policy but this relationship is not same for all ownership identities i.e. director’s, individual and institutional ownership. Supervisor: Dr. Arshad Hassan