From the vision of knowledge transfer, this paper analyzes the influence mechanism of how the value expansion of knowledge transfer, cost variables, the characteristic of transferred knowledge, characteristic of the subject of knowledge transfer and characteristic of the context impact the stability of technology alliance. The conclusion shows that the degree of knowledge transfer is up to the ratio of value expansion from knowledge transfer and transferring cost, and finally determines the stability of technology alliance. Technology alliance stability requires that alliance members expand acquisition of complementary knowledge value and reduce the cost of knowledge transfer.