This paper examines how collaboration with multinational enterprises, and state-owned status, affect local firms’ attempts to expand internationally. We theorize that experiencing domestic alliances with foreign investors will induce knowledge spillovers that affect a firm’s choice of country and entry mode in subsequent foreign investments. We also theorize that the effect of domestic state ownership on these outcomes is contingent on the extent of state involvement in the host economy. Using a sample of firm-level foreign direct investment (FDI) in- and out-flows for China during 1978-2011, we find substantive effects of joint venture experience on the propensity of Chinese firms to conduct FDI and on where and how they enter. In addition we find that the effect of state ownership is contingent as predicted. We draw implications for internalization and institutional perspectives on FDI, and specifically for the study of state-owned and emerging-economy firms.