This chapter discusses graduate work-readiness challenges in Malaysia in the light of government efforts to achieve developed nation status by 2020. With a population of 31 million, an unemployment rate of 3.4 percent and a labour force participation rate of 67.6 percent, Malaysia have the potential to grow further, albeit in a context of global economic uncertainties. The World Bank argued that in order to improve the work-readiness of Malaysian youth, it was necessary to explore the matrix of skill mismatches and to survey the gaps between industry expectations and the outcomes of tertiary education institutions. The Malaysian education system reflects the three major constituencies of the population: Bumiputera; Chinese; Indian; and others. Only primary school education is compulsory in Malaysia, where multi-lingual public schools, private schools and home educators co-exist. In the 1890s, trade skills training began in Malaysia with the establishment of vocational schools to prepare Malaysian youth to work as mechanics and fitters in the railway sector.