Abstract: Appropriate knowledge protection is the necessary condition for successful strategic alliance. Based on transaction cost theory and institution theory，this paper explores the moderating effect of market uncertainty and law incompleteness on the relationship between knowledge protection and alliance performance, and the moderating effects of Guanxi orientation on the impact of market uncertainty and law incompleteness. Through the empirical analysis with 227 samples in the R& D alliance, the findings are revealed: Market uncertainty and law incompleteness is negatively moderates the relationship between knowledge protection and alliance performance. Guanxi orientation can weaken the moderating effect of law incompleteness, but the influence of Guanxi orientation on the moderation effect of market uncertainty is insignificant. This research has important theoretical and practical implications on the management of alliance firms’ knowledge.