This study investigated how corporate political connections affect firm performance among domestic (Korean) firms. Most prior studies have found a positive relationship between political connections and firm performance. However, the majority of these studies were conducted on Chinese firms and had limitations in that they failed to consider the environment in which firms operate. Meanwhile, in Korea, the movement of former government officials into the private sector has been increasing, leading to the creation of various regulations. Before making judgments about the rightness or wrongness of this social phenomenon, this study aimed to analyze the relationship between political connections and firm performance among domestic firms. To this end, an empirical analysis was conducted on 296 IT-related manufacturing firms in Korea from 1997 to 2016. The results confirmed an inverted U-shaped relationship, wherein a certain level of political connections positively affects firm performance, but excessive political connections negatively affect firm performance. Furthermore, it was found that environmental dynamism weakens the positive effect of political connections on firm performance.