A critical question for Information Systems ( IS) academics and practitioners is whether and how Strategic Value of Information Technology ( SVIT) manifest in stable and dynamic environment． To address the question，strategic value of IT is investigated from an integrative view of Competitive Strategy Theory and Core Capability Theory，and a basic premise is that strategic value of IT can be explained by how effective the firm is in using IT to support its competitive strategies and core capabilities． Using resource-picking and capability-building arguments，a research model which interrelates IT resources，IT capabilities，IS support competitive strategies，IS support core capabilities environmental dynamics and firm performance． The model is empirically tested using data collected from 233 firms in China to investigate the underlying mechanism of SVIT creation under different environment dynamics． The results suggest that the appropriate mechanism in the relative stable environment is resource-picking while the capability-building mechanism is suitable for the dynamic environ-ment． The results also indicate that firm’s IT capabilities are greatly dependent on the nature of IT infrastructure，technologic and managerial IT resources，and relationship resource of IT department under two different environmental dynamics．