This thesis analyzes the United States' Dollar Diplomacy and its practices towards the Ottoman Empire during William Howard Taft's presidency. The United States was not quite interested in improving its economic and diplomatic relations with the Ottoman Empire, before the reopen of the Ottoman Parliament in 1908. On the other hand, the declaration of the Second Constitution and new parliamentary system grasped the attention of the US Government. From the American point of view, this new state system would be more open and acquiescent to adopt American institutions and cooperation in various fields, in the name of modernization. The United States commenced to increase its economic, diplomatic, and commercial relations with the Ottoman Empire, in this era. During Taft's presidency, American foreign policy concentrated on assisting and protecting any American commercial interests, around the world with the promotion of American businesses, investment, and trade. In his short term, Taft gave importance to conduct this policy, which cited as the Dollar Diplomacy, in the Ottoman Empire along with Central American states and China. This policy could not reach its ultimate success in the empire in aspect of promoting American investments intensely, in this country. As they experienced throughout the Chester Project, which was a significant railroad concession project in the Eastern Anatolia, the Ottoman Empire struggled with political problems in this era and its negative effect over the American investments were distinguishable. Still, this era witnessed significant progress in not only in aspect of promotion of American initiatives, as the Chester Project, but also economic and commercial relations with the help of the State Department.