One of the recent phenomena information systems (IS) practitioners are currently facing in their continuous process of adopting new technology is the utilization of Extensible Markup Language (XML). In this paper we propose an XML adoption framework, a corresponding adoption space model, and a probit model of technology diffusion to examine the decision of adopting XML-based applications in the context of electronic business. First, an XML adoption framework is proposed. The framework helps companies examine their current status in the electronic business environment from the perspective of three electronic business domains, namely enterprise intranets, value-chain extranets, and the global Internet. This framework also provides guidelines for companies seeking to understand the potential benefits of adopting XML technology, and then further suggests the appropriate path and proper applications. Second, we propose an XML adoption space model. Considering its current status of IT applications, a company can utilize this model to measure the efforts/costs that will be incurred by developing XML-enabled IT applications. Third, we use a probit model of technology diffusion to explore the feasibility of a company's adoption of XML technology. This probit model considers a company's specific characteristics and evaluates benefits and efforts/costs of its XML adoption decision.