This study aimed to systematically establish the types of corporate distress among firms that become financially troubled in various ways in modern capitalist society, thereby identifying the characteristics of firms prone to distress and preventing the occurrence of corporate failures preemptively. To achieve this research objective, we reviewed and analyzed domestic and international research literature on the typology of corporate distress, and conducted an empirical analysis of firms that became financially distressed in Korea between 1985 and 1987. The data used in this empirical analysis consisted of financial ratios derived from accounting data and other financial information, which are relatively easy to collect and generally represent the condition of firms well. To analyze these data and classify (typologize) distressed firms, we primarily employed cluster analysis, a multivariate analysis technique, along with other statistical methods. The types of firms identified one year prior to distress through this empirical analysis are as follows. First, Type I refers to firms that became distressed due to difficulties in procuring funds (cash) while pursuing only external growth. This type frequently occurs among firms in developing countries such as Korea, and the largest number of distressed firms in this study belonged to this type. Second, Type II refers to firms that became distressed due to declining profitability and cash procurement difficulties resulting from inefficient management of (current) assets. Third, Type III refers to distressed firms where the degree of distress was severe in all respects, making recovery nearly impossible. Fourth, Type IV refers to firms that became distressed due to insufficient liquidity after prolonged stagnation in business conditions. Fifth, Type V refers to firms that, while exhibiting sound profitability and cash flows similar to healthy firms, became distressed due to short-term strategic errors such as temporary liquidity shortages. Therefore, one should never be complacent simply because financial indicators appear sound.