We examine the relationship between investment horizons of institutional investors and firm value. In addition, we investigate whether the effect of investment horizons of institutional investors on firm value is more powerful in the companies with institutional investors as outside block-holders than in firms without them. Using a comprehensive sample of 6,550 non- financial firm-year data listed on the Korea Stock Exchange from 2003 to 2014, we find that investment horizon of institutional investors has a positive relation to the firm value. Furthermore, such association is more prevailing in the firms with institutional investors as outside block- holders than in companies without them. This findings indicate that long-term investment of institutional investors increases firm value and such relation is much stronger in the firms with institutional investors as outside block-holders who are independent from management and have incentives to monitor management.