China’s modernization drive calls for active importation of advanced managerial expertise in addition to capital and technology from Western developed countries. The first step in the importation of advanced managerial expertise, which should include legal rules and concepts relating to business administration, involves translation of the legal terms which embody the legal concepts. Accurate translation of legal terms is, however, never easy. Among the factors which pose difficulties to correct translation of legal terms are cultural elements in both the source language society and target language society. It is with cultural effects on translation in mind that this author embarks on this seemingly easy but in fact very difficult undertaking - the study of cultural effects on translation of legal terms.In this study, two research questions are set out at the outset, i.e. 1) Do cultures affect translation of legal terms and how, if any? and 2) If those effects do exist, how can a legal translator successfully translate the meaning of a legal term into a proper translated term in the target language by taking the cultural elements into consideration?In order to answer these questions, the author has read extensively linguistic works and found the following theories particularly relevant: 1) Leech’s elaboration on associative meaning of lexical terms; 2) Nida’s efforts on associative meaning in cross-cultural translation studies; 3) Li Yunxing’s Model Selection proposition. Then based on these theories with modifications and amendments, I have constructed a theoretical framework.The theoretical framework consists of three parts. First part shows how legalcultural factors in the source language society affect the meaning of a legal term, I.e. associative meaning of the legal term. The second part represents the temporary storage of the associative meaning in the mind of the translator. And the third part indicates the translator’s model selection process by taking cultural elements in the target language society into consideration.Finally, the theoretical framework is applied to the analysis of practical questions. Through the actual application of the theoretical framework, the author finds it fairly satisfactory, although with limitations. It is hoped that more resources, especially those from Taiwan and Hong Kong, are available for further studies and that the parameters or cultural elements affecting translation can be further explored and enriched so that the theoretical framework will have greater practical value.