The purpose of the present study was to explore the impact of perceived teachers' competence on students' performance moderated by perceived class environment. The sample consisted of 500 students (250 male & 250 female) taken from public and private schools from the rural areas of Dokota Town, Tibba Sultan Pur, and Mailsi. Participants' age range was between 12-14 years old. Teaching Competence Scale (Passi & Lalita, 2009) and Class Environment Scales (Kelly, 2010) were used to measure the perceived teachers' competence and perceived class environment, respectively. For the purpose of the present research, scales were translated into Urdu through back translation method. Results indicated that perceived teachers' competence predicted the students' performance, but did not predict the perceived class environment. Further results indicated that there is no mediation and moderation effect of class environment on the relationship between teachers' competence and students' performance.