In the past few years, the nature of Saudi Arabia’s foreign investments has been under a lot of national and international scrutiny. This interest, according to most scholars, is based on the vibrant nature of the Saudi market thus making it a desirable place for potential investors. In spite of this increased focus, there have only been few studies conducted to understand the effectiveness of the legal investment framework in Saudi Arabia. As a result, most of the information in relation to the legal landscape governing foreign investment in Saudi Arabia is not fully understood. It is with this object in mind that this paper analysis the potential of foreign investments in Saudi Arabia specially addressing who can invest and in which sectors investments are possible as well as the protection mechanism which are in place to guarantee foreign investments.