This paper broadens the scope of study of foreign direct investment (FDI)-economic development relationship in post-conflict countries by investigating the effect of transitional justice (TJ) mechanisms both on FDI and on FDI-economic development relationship. The relationship between FDI and economic development has been discussed by academics and policymakers. Literature suggests that FDI contributes to higher economic growth by triggering technology spillovers, helping the formation of human capital, integration of international trade, creation of competitive business environment. An emerging literature highlights the importance of investment climate in post-conflict countries. Promotion of a strong investment environment is a key driver of post-conflict recovery, especially in supporting growth, creating jobs, and enhancing well-being. FDI is likely to be higher in strong growth countries compared to weak growth countries at the end of conflict. In the immediate aftermath of conflict, investors are cautious to invest because of political, security and business risks. There are many ways to improve the investment climate and therefore improve economic development. In addition to more orthodox approaches, current research focuses on post-conflict countries’ ability to attract FDI by implementing TJ mechanisms. Even though FDI favors countries that have natural resources, peace policies and commitment also matter. Using a panel data regression analysis, this paper tests for the influence of TJ on the relationship between FDI and economic development with moderation analysis for conflict countries between 1970-2006. I expect to observe that TJ strengthens the positive nature of the FDI-economic development relationship in post-conflict countries.