The study aimed to examine the effect mechanism of corporate governance and financial performance of the prediction of financial distressin the manufacturing companies listed in Indonesia Stock Exchange. This study uses five variables which is predicted to affect financial distress. Three first instans variables are indicators of corporate governance mechanism is institutional ownership, the size of the board of directors, and board size. The next two variables are financial performance in the form of liquidity and leverage. This study used a sample of manufacturing companies listed in Indonesia Stock Exchange during the period 2012-2015. Purposive sampling method is used to determine the sample in accordance with the criteria used, so it found a sample of 60 companies. In this study conducted during the observation period of four years, then after the sample is multiplied by the period of observation obtained 240 corporate data sample used. This research was conducted with quantitative methods and analysis used the logistic regression testing. The results showed that all the corporate governance mechanism that is used as a variable in this study did not significantly influence the company's financial distress prediction. Financial performance variables that liquidity does not significantly influence the company's prediction of financial distress, while leverage significantly influence the company's financial distress prediction. Keywords: Institutional Ownership, The size of the Board of Directors, The size of the Board of Commissioners, Liquidity, Leverage, Financial Distress.