Dispute is not uncommon in the complex and fragmented construction industry. Construction disputes, even though extensively investigated, still plagued the Malaysian construction industry. This paper aims to develop a dispute performance index to predict the dispute occurrence in Malaysia. A questionnaire survey was conducted among 374 respondents to generate the weightage of the indices. Dispute sources were classified into stages of preconstruction, construction, and post construction. Principal Component Analysis (PCA) was conducted on the data collected from the survey. PCA analysis results were then utilized to perform Structural Equation Modeling (SEM) analysis. SEM evaluated the causal relationship between dispute sources and dispute resolution methods to develop a dispute resolution performance index. The index is essential to benchmark the dispute resolution performance and hence provides a guideline to the construction players in handling and or avoiding disputes.