According to rapid changes in information age, Iranian organizations should move faster toward optimization of e-business. In order to achieve this strategic goal, recent study develops a conceptual model for presenting the factors affecting e-business diffusion (internal integration and external diffusion) based on TOE framework. The purpose of this model is examining the influence of technological factors (IS infrastructure and IS expertise), organizational factors (organizational compatibility, expected benefits of e-business, top management support and organizational learning ability) and environmental factors (competitive pressure and trading partner readiness and regulatory environment) on e-business diffusion. This model was tested by 90 managers who are familiar or involved in information system projects in different Iranian organizations with a questionnaire. The research method applied in this study is descriptive by using structural equation modeling. The findings show that organizational factors on internal integration and environmental factors and internal integration have positive meaningful effects on external diffusion. The findings also show that technological factors have no positive meaningful effect on e-business diffusion.