Strategic alliance is considered to be of importance to the growth of firms. Strategic alliance is the most important component in a fims strategy to increase firm performance. The objective of this study is to know the effect of strategic alliance on firm performance at PT Al Falah Tours & Travel, Medan.Each firm in the alliance to draw on the core competencies of the firm with the objective of encouraging the growth and development of each member within the alliance is the strategy in alliance.The method used in this research are quantitative descriptive and correlational method. Sample size 42 through census sampling technique. Data analysis methods used in this research are descriptive statistic, validity test, reliability test, normality test, linearity test, coefficient of correlation, coefficient of determination, linear regression analysis and Z test. Based on research result, the hypotheses test of Z test confirmed the simple linear regression showed equation of Y = 10.697 + 0.576X. It means that strategic alliance has a straight relationship to firm performance. From correlation test, the correlation value is 0.625. It shows that there is strong and positive relationship between strategic alliance with firm performance at PT Al Falah Tours & Travel, Medan. The company is recommended to improve its business performance, alliance process, terms finance, marketing and other production processes.