The firms usually get the growth chances through developing their potential. Product and market diversification doesn’t only expand the business scope of the firms. They are the important ways to pursuing success, too. In the meantime, the product diversification implies the technological diversification, but this strategy doesn’t always lead to success. It’s worth to study the decision of technological diversification and Technological capital building. The TFT-LCD industry in Taiwan has been developed for a long time. We hope to understand how the R&D capability to influence the firms’ performance, especially in this industry. We build our hypothesis via the data and information of this industry. Based on our study, we find these hypothesis were supported in the sales, but the H2 didn’t supported in ROA of their performance.