There was a close link between education and development. Education played a vital role in human capital formation. Academic failure from university was a problem that had became a serious concern for higher education institutions. This study presented the result of a recent investigation at the University of Gujrat that attempted to identify the post enrollment factors that students perceived as having important influences on students failures in their university studies. Data was collected by using questionnaire. The Independent-Samples t-test procedure was used to compares means for two groups of cases. Structural equation modeling (SEM) analysis was also performed to test the relationship among latent factor represented by the actual data from 100 drop out students of university. Finding indicates that male and female groups were significantly different in their perception of causes of academic failure, but perception of students from different programs Bachelors in science, Master in Arts and Science (BS, M.A/M.Sc) was not significantly different. In our estimated model class participation and lack of family support was directly affected on students drop out from university, but wrong choice of subject and change of system which was basically link with class participation and indirectly effect on students drop out.