International trade helps countries to get what they cannot produce by themselves and　　 disposing of their own surpluses.Todays international trade is a complicated process and noteasy for companies, especially for small and medium enterprises (SMEs), to deal with.If　　 SMEs have problems to deal with the international trade process, it brings another series ofproblems such as financial risk, over stock, customer relationship, and market reaction　　 problems.Like in many developing economies, in Saudi Arabia, SMEs play a very important　　 role in developing the economy.However, with socio-eultural and economic characteristics　　 of Arab region, they are facing more challenges and barriers that impact negatively their　　 business generally, especially their competitive advantage in international trade.Nowadays,because of the heavy Internet use, e-commerce has great potential, and its role in society is expanding at a remarkable rate.E-commerce has the potential to radically alter economic activities and the social environment.It has redefined the way business is conducted by　　 replacing the traditional intermediary functions, developing new products, and penetrating　　 new marketplaces.The online economy introduces unique opportunities to SMEs for open　　 and free international trade because it lessens the impact of geographical distances and time,which can separate SMEs from potential opportunity.　　 This study developed two arguments include: Saudi Arabian SMEs are looking for solutions, such as new business models, new business trends to improve their current business situation.In global economy, besides external challenges, they are also facing many internal problems need to be solved.Especially, worrying much on competitive pressure in international trade and how to improve competitive advantage? And e-commerce seems to be an effective tool which can help them to ameliorate the competitive situation. Consequently, a literature review on international trade of Saudi Arabia is discussed sharply, characteristics of e-commerce and research theories on competitive advantage in economic business is introduced.Moreover, a qualitative study on the current situation of Saudi Arabian　　 economy and international trade business SMEs, the exporting business processes, and　　 potential problems of Saudi Arabian SMEs is carried out.Furthermore, a questionnaire　　 survey was also conducted to identify perceived problems that are believed impact negatively competitive advantage of Saudi Arabian SMEs in international trade.Finally, based on the resource-based theory the role of e-commerce in Saudi Arabia and whether e-commerce　　 builds the sources of competitive advantage for Saudi Arabian SMEs was analyzed.　　 This dissertation found that most the perceived problems by SEMs in Saudi Arabia　　 are related to finding new foreign customers, getting relevant information, frequency of　　 shipping delays, impact of shipping delay, and export and import procedures.Many new　　 findings about the current situation of Saudi Arabian SMEs were discovered.Especially, a　　 worth finding was found that is e-commerce technology seems to be hoped as a good solution　　 that can help Saudi Arabian SEMs to solve their perceived problems in international trade　　 business by enterprises executives.Finally, technology resources, managerial skills, and　　 business network of e-commerce technology are the sources of competitive advantage　　 because they are valuable, imperfectly immobile, and heterogeneously distributed across　　 firms and e-commerce capabilities can be concluded as strategic resources that can confer　　 durable advantage for firms.　　 A first limitation is the fact that we cannot guarantee that we have been exhaustive in　　 identifying potential problems.The small size of the sample in the field research is also one of the limitations of this thesis.Another limitation is that we interviewed Saudi Arabian SMEs executives only from two biggest economic cities of Saudi Arabia.Finally, several recommendations for further research were suggested.