This paper deals with the effect of foreign direct investment(FDI) on industry and on international analysis on the effect of FDI on international trade was made. The gravity model was adopted for that purpose. It turns that the increase in FDI in Korea induces the increase of exports as well as imports. But the net effect, that is, the effect on trade balance, turns out to be positive, if not significant. Survey of 1,286 foreign firms in Korea were made as well. The survey shows that FDI in Korea is, in general, market oriented. The average ratio of imported raw materials as well as the average ratio of domestic sales to exports are relatively high. The market oriented nature of FDI is noticeable especially in transportation machinery and other manufacturing sector, and in FDI from the United States.