Abstract: Objectives: Financial Economics Theory indicates company decisions for liquidity may include making balance between cash reserves and cost of accessing managers to cash assets. The goal of this research is studying the effect of Product Market Competition (PMC) on relationship between Cash Flow Management (CFM) and capital structure. Prior Work: The results of past studies showed that product market competition can act as a controlling mechanism for decrement of agency problems between managers and investors, because managers gravitate toward no-added value activities and non-useful projects to preserve their situations and to prevent dissolution in order to maximize their company values. Approach: Using data from 86 listed companies in Tehran Stock Exchange from 2010 to 2020, this is a descriptive-correlational research and multi-variable pooled data, so multi-variable regression was used to test the assumptions, and Extended Least Square Method (ELS) was used to estimate it. Results: The results show that the relation between cash flow and capital structure management is affected by competition in product market. Implications: Therefore, companies with severe competition and low concentration utilize high cash flow. Meanwhile, these companies have lower debt ratio in their capital structure. Value: Additionally, competition in product market decreases excess investment or removes ignoring benefits of stockholders by lowering flexibility of management towards accumulation of cash reserves. One of the innovative aspects of the present research is notice to the equalizing role of product market competition against cash flow management and capital structure of companies.