This article focuses on analyzing the impact of headquarter's knowledge diffusing capability, diffusing motivation, richness of explicit and tacit knowledge transferring channel, its subsidiaries' absorptive capacity and absorptive motivation on the effectiveness of knowledge transfer, and builds the theoretical model. The results show that national cultural difference is a significant barrier in the crosscultural knowledge transfer within MNCs. The cultural differences have moderate effects upon the relationship of headquarter's knowledge diffusing capability and subsidiaries' absorptive capacity with knowledge transfereffectiveness. Measures are put forward to improve the effectiveness of cross cultural knowledge transfer from MNCs' headquarters to their subsidiaries.