Abstract: In recent years, third-party funding has undergone a transition from prohibition to permission and gradually expanded from litigation to arbitration, especially in the field of international investment arbitration. Third-party funding in international investment arbitration provides the applicants who are in economic distress or want to share the arbitration risk with the opportunity for access to justice and serves as a deterrent to the wrongdoings of host countries that harm the interests of investors. However, the profit-seeking nature of funders may lead to their filing of frivolous claims and the failure of the host country to obtain compensation of arbitration costs when winning the lawsuit, and the secrecy of the funders' participation in the investment arbitration procedure may lead to conflicts of interest between funders and arbitrators. The international community should take measures such as requiring the funded parties to fulfill the mandatory disclosure obligation, granting investment arbitral tribunals the power to regulate the behavior of the funded parties and the funders through cost decision and strengthening the independence and impartiality consciousness of the arbitrators, so as to maximize the economic benefits of third-party funding in international investment arbitration.