We present evidence on the relation between local corruption and firm value in the United States. We find that firm value (Tobin’s Q) is significantly lower in more corrupt areas, after controlling for endogeneity. However, firms that sell goods and services to the government (i.e., “government-dependent firms”) are less negatively affected by local corruption. Further, firms in more corrupt environments are informationally less transparent. Importantly, we find that stronger corporate governance (either internal to the firm or due to an exogenous regulatory change in governance standards) benefits firm value but largely in more corrupt areas. Overall, we find that corruption matters for firm value even in the U.S., however, stronger corporate governance mechanisms can overcome some of the ill-effects of corruption.