In the knowledge economic era, how to effectively accumulate and explore knowledge becomes the key factor to the success of MNCs in the global market. ¡§Human¡¨ will be the main source to create the competitive knowledge, also plays an important role of the process in knowledge management. Therefore, knowledge and human capital investment will be the most important resources for enterprises to keep competitive advantage. The main purpose of this research is to develop a framework of knowledge strategy and human capital in subsidiaries of MNCs. Using quantitive interview research, samples are from 6 companies in 3 industries. The major findings of this study are listed below: 1. ¡§Active subsidiary¡¨ and ¡§early entryer¡¨ will have positive effect in human capital investment. 2. The more subsidiary adapt ¡§global innovator¡¨ and ¡§local innovator¡¨ these two knowledge strategies, the more they will emphasize on human capital localization and top manager¡¦s competence. 3. ¡§human capital investment¡¨, ¡§top manager¡¦s competence¡¨ and ¡§ employee¡¦s ability of entrepreneurship¡¨will have positive effect on subsidiary¡¦s performance. 4. In the network between HQ and subsidiary, ¡§outflow of knowledge¡¨ will have positive effect on subsidiary¡¦s performance.