In corporate finance literature for market reaction to dividend announcements reports mixed result, some of studies support the positive response of market as result of dividend announcement where as some report negative. This study is an attempt to investigate the heterogeneous market reaction dividend announcement for 73 firms listed in KSE. We investigated this phenomenon with novel methodology using both the event study and multivariate regression for the possible effects of firm specific factor associated with the dividend announcements. We report that the market reaction is one sided as majority of companies of the sample for given period are with positive CAR. We can't ignore the importance of firms specific factor that has effect on the dividends but we conclude that majority of companies of the sample period are portraying positive CAR and market reaction is positive. Key Words: Dividend Announcement, Cumulative Abnormal Returns, Firms Specific Factors, Market Reaction.