n this era of industrialization, it is very difficult for firms to develop and sustain the competitive advantage. Industrial competition spread so rapidly worldwide, which neglect the differentiation of products and it is very difficult to sustain the competitive advantage in the market. Large economies capture the maximum world market and give tough time to small economies such as Iraq. Thus, the primary aim of the current study is to present a comprehensive theoretical framework for competitive advantage, which leads to better firm performance. Many studies have highlighted the area of competitive advantage of the firms, however, in a rare instance, literature has reported limited discussion on sustainable competitive advantage, especially in the context of Iraq. This research gap formulated four hypotheses, which are proposed the relationship between empowerment strategy, organizational learning and competitive advantage. The pick and drop method was adopted to distribute the questionnaires among four hundred manufacturing firms of Iraq. The results of the current study found a positive and significant relationship between empowerment, organizational learning and competitive advantage. Furthermore, the current study found a significant relationship be-tween empowerment strategy and organizational learning. Moreover, organizational learning was found the main contributory factor between empowerment strategy and competitive advantage in Iraq industrial context. This work contributes to the consistency of knowledge by developing a comprehensive theoretical account to build and sustain the competitive advantage of Iraq industry. Hence, the current work is helpful for sustainable competitive advantage of companies to achieve the highest firm performance.