This paper analyzes the impact of e-government on foreign direct investment (FDI) in Iran, with emphasis on the role of institutional corruption, over the period from the fourth quarter of 2003 to the first quarter of 2024. So, a Smooth Transition Regression (STR) model is employed, and the corruption index is incorporated as the transition variable in the FDI function. The results indicate that FDI behavior in Iran is nonlinear and dependent on institutional quality, with institutional corruption playing a decisive role in shifting behavioral regimes. The corruption index's threshold value is 0.83, and values below this threshold correspond to a low-corruption regime, while values above it indicate a high-corruption regime. Corruption exerts a negative effect on FDI in both regimes; but this negative effect is stronger in the high-corruption regime. E-government has a positive effect on FDI in both regimes, and this effect is more under conditions of high corruption, highlighting the compensatory role of e-government in weaker institutional environments. Economic growth, regulatory quality, and communication infrastructure also positively affect FDI. Overall, the findings suggest that as corruption increases, the development of e-government can effectively mitigate the adverse effects of corruption and facilitate greater attraction of FDI in Iran.