In order to advance our understanding of technological firms’ vertical ally‐or‐acquire choices, this study applies resource dependence theory to explore how mutual dependence and dependence asymmetry between partners’ technologies affect governance choice. The collective effect of mutual dependence, dependence asymmetry and governance choice on technological performance of the transaction is also examined. Heckman's two‐stage analyses of 135 technology alliances and 91 technology acquisitions suggest that mutually dependent firms tend to adopt acquisitions, whereas asymmetrically dependent firms tend to adopt alliances. The fits between dependence asymmetry and alliances, and between mutual dependence and acquisitions consequently enhance technological performance.