A rich literature has shown that external finance is an important resource for firms to overcome trade costs and to engage in exporting activities. In this paper, we build on the rationale and extend it both to domestic and international trade costs, by studying whether there are significant differences in the importance of external finance on firms’ domestic and international sales. In addition to international trade costs, China has witnessed some substantial overt and/or covert trade costs across its provincial borders, which provide an interesting country case study for external finance and firms’ domestic and international sales. We utilize the World Bank Survey of 12,000 firms operating in China, and differentiate firms’ sales destinations within their home provinces, outside their home provinces, exports only, and domestic plus international sales. In so doing, we explicitly compare how firms’ external finance helps firms overcome trade barriers across provincial borders and across national borders. Our results indicate that external finance is indeed very important for firms to overcome either provincial trade barriers, or international trade barriers, or both; and the effects of external finance vary across firms’ ownership structures and their sales destinations.