The purpose of this study was to identify the significant characteristics of distance education students who have dropped-out or continuously and successfully progressed in the distance education program at the NOU of Taiwan. The major focus was based on the found factors which might relate to the students' decisions for dropping out or staying in the distance education program to establish a set of strategies to reduce dropout from distance education courses. The participants in the study were undergraduate students who originally enrolled in the distance education undergraduate program at the National Open University of Taiwan. The instrument used in this research was a mailed questionnaire for investigating the factors of dropout or retention for distance education students, demographic variables, goal commitment, social integration, and academic integration. Results indicated that the factors of external attribution, intrinsic motivation, and students' perceptions of distance learning showed significant relationships with students' decisions of dropout or retention. Based on the findings, the researcher made certain recommendations to institutions for reducing student's dropout rates from distance education courses.