This study investigates the effect of strategic deviance of firms on the cost of debt. Strategic deviance as independent variable is defined the difference between the strategies of firm and the overall tendency of strategies in the industry. Cost of debt as dependent variable is defined as credit ratings provided by credit rating agency or borrowing rates derived from financial statements. Using the firms listed on the Korea Stock Exchange for the period 2000 to 2018, this study finds negative association between strategic deviance and cost of debt. This result indicates that the capital market assesses that the negative impact of strategic deviance on the reliability and relevance of financial information increases information risk. In addition, the negative association between strategic deviance and cost of debt is lower when a managerial ability is high. This study increases the understanding of the interaction between business strategy and information risk perceived by capital market. In addition, a firm with a high degree of strategic deviance presents a practical implication that it is necessary to consider a way to signal information about the firm's current and future prospects to outside stakeholders in order to respond to negative assessments.