The study investigated the effect of trade liberalization on industrial productivity by integrating panel data econometrics with stochastic frontier analysis to address methodological challenges in measuring productivity changes. While traditional economic theories suggest that trade liberalization enhances industrial productivity through competitive pressure, technology transfer, and economies of scale, empirical findings have been mixed due to variations in economic contexts, industrial structures, and institutional conditions. This study employed a longitudinal dataset covering 4,382 manufacturing firms across 14 industries in eight countries that implemented trade liberalization between 2005 and 2020. By using a translog stochastic frontier model with firm-level fixed effects, the study estimated technical efficiency and distinguished between productivity gains arising from efficiency improvements and technological progress. A two-stage stochastic frontier approach was used to assess the role of input and output tariff reductions in influencing industrial performance. Results indicated that input tariff reductions had a stronger positive impact on technical efficiency compared to output tariff reductions, particularly for firms initially further from the efficiency frontier. The study also confirmed a J-curve pattern in the productivity response to trade liberalization, where short-term inefficiency increased due to adjustment costs before significant productivity improvements emerged after approximately 2.3 years. Furthermore, spatial econometric analysis revealed substantial productivity spillovers, with neighboring firms benefiting from liberalization through knowledge diffusion and supply chain integration. The study also identified institutional quality as a key moderator of trade liberalization effects, with stronger productivity gains observed in economies with higher governance, regulatory quality, and infrastructure development. Policy implications highlight the need for gradual trade liberalization strategies, targeted industrial policies to support adjustment periods, and investments in institutional frameworks to maximize the benefits of trade openness. The