This study investigates the relationship between the characteristics of foreign investors’ownership structure and firms’earnings management through real activities, using a large sample of firms over the 14year period, 20022015. Following previous researches, there have been many researchers that investigated the relationship between foreign investors and firms’accrualbased earnings management. however, a few of previous researches have investigated the monitoring role of foreign investors on the firms’real earnings management. Firms’managers have a greater willingness to use the earnings using real activities rather than accruals. Because the real earnings management that needs managers’depth of understanding of potential aspects of business are less likely to draw auditors’and regulators’monitor than accrualbased earnings management. However, Roychowdhury(2006) thesis come up with the presence of intelligent investors control the extent of real activities manipulation. Foreign investors are known as intelligent institutional investors that have a greater ability to analyse through the longrun meaning of firms financial materials. Therefore, The foreign investors′ sophisticated activities reduce the benefits from financial private information that would adversely affects the managerial decision. This would act as a control for firms managers to use in real activities manipulation, particularly if this manipulation reduce firms’economic value. Our prediction is consistent with the analytic results that indicated the firms’foreign investors is negatively related to the real earnings management.