The recent information society is affected by new technologies including EC(Electronic Commerce), CALS(Commerce At Light Speed), EDI(Electronic Data Interchange), telecommuting and teleconferencing. The research goal of this paper is to identify major failure factors to reduce the dysfunction of EC and to suggest possible strategies that overcome those obstacles. The research methodologies of major failure factors are very similar to those of critical success factors which were widely used in MIS research areas. Ideally EC provides the possibility of a win/win situation for vendors and consumers. A survey study was performed using questionnaires. The factor analysis was performed to identify failure factors. Several hypotheses were set up to identify the major failure factors to reduce the dysfunction of EC. The regession analysis was performed to test those hypotheses and to understand the relationships between the major failure factors identified and the performance variables such as satisfaction, usage, and usefulness. Finally, the paper suggests alternatives to activate EC in terms of regulations, social rules, a technological model, etc.