ABSTRACT It is necessary to identify that what are factors contribute to the firms’ capital structure composition in its operation. Hence the present study was undertaken with the objective of finding out the relationship between capital structure determinants and ailing manufacturing firms of the listed companies in Nigeria. Using a multiple regression analysis, ailing manufacturing companies in Nigeria stock exchange market was examined for the period of 2005-2010. The final sample consists of 14 manufacturing companies. In this study, dependent variable that is, leverage level of the companies, is measured by long-term debt ratio, short term debt ratio and total debt ratio. Capital structure determinants (independent variables) are measured by capital intensity, tangibility, profitability, firm size and non- debt tax shield. Findings showed that the direction of the explanatory variables such as tangibility, profitability, firm size and non-debt tax shields with total debt largely consistent with the explanations of trade-off theory and prove past empirical findings also. Keywords:Capital structure determinants, Ailing firms, Non-debt tax shields, trade - off theory.