Agile software development methods are characterized by developer’s empowerment through self-organization, incremental requirements and constant knowledge sharing. Despite some effort to elaborate how successfully agile methods can be applied in co-located development teams, little is known on how the same is done when the development teams are distributed. Our research focus is to uncover factors that influence the successful application of agile methods in distributed development teams using a software development company as our case study. With three distributed teams applying different agile methods, we conducted focused ethnography alongside interviews to comprehend what and how various factors under distributed development teams influence successful agile methods application. It seems, all that matters is team structure, team spirit, effective communication, product requirements, and knowledge sharing. The team structure has more influence than other factors and therefore our suggestions for successful application of agile methods in distributed software development is to focus on the development team, above all factors. The analysis shows that the development methods themselves have little to do with the successful application of agile methods in distributed software development teams.