Terrorism has become a focus of much political thought over the past few years, and with good reason, yet most quantitative studies of terrorism investigate the likelihood of a terrorist incident while ignoring the precursors to terrorist group formation. I examine cases of new terrorist group formations between the years 1968 and 1999 as a function of domestic demographic, geographic, governmental and societal factors. This is done by Poisson regression analysis, which determines the significance of the independent variables on a count of new international terrorist group formations per country year. The results indicate that higher levels of material government capability, high levels of political freedom, the availability of low-cost refuge, and a cultural tradition of terrorism all have a positive impact on the number of new terrorist group formations, while a higher degree of governmental durability has a negative impact.