This research aim to analyze the Effect of Compensation on Employee Performance with Job Statisfacation as an intervening variabel. The object of this study is PT Indomobil Nissan Datsun Bantul which is located on JL. Ring South Road, Taman Tirta, Jadan, Tamantirto, Kasihan, Bantul Regency, Special Region of Yogyakarta. In this study in determining the study sample using Saturated samples are all members of the population used as samples. So that the number od samples in this study were 55 employees. And the data analysis technique used is Path Analysis. Based on the results of the analysis in this study, the results show that Compensation has a significant effect on employee performance. This corresponds to a significant value of 0.002 <0.05. So that stated Compensation has a direct effect on employee performance. Compensation has a significant effect on employee job satisfaction, this is seen from the significant value of 0.000 <0.05. Job Satisfaction has a significant effect on employee performance, this is seen from the significant value of 0,013 <0,05. The value of direct influence from Compensation on employee performance is 0.169 <from the value of indirect influence from Compensation to Performance through Job Satisfaction of 0.189 so Job Satisfaction is an intervening variable