The present study is based on socio-economic and demographic factors and focused on the proportion of educated females’ participation in labor force. Binary logistic regression is utilized to determine the factors affecting female labor force participation in formal sector. The data collected by the PSLM (Pakistan Social and Living Standards Measurement Survey, 2007-08) about the individual and household characteristics of females between the ages of 21-60 years are used for analysis. Empirical results suggest that secondary and tertiary education plays a significant and positive role in females’ decision to participate in formal sector. The results also indicate that females’ participation in formal sector is highly correlated with the MPhil/PhD or a professional/postgraduate degree. Moreover, females are more likely to participate if they are married, living in urban area and belong to a nuclear family with many sisters., Whereas the age of females, presence of boys at home and female as a head of the household reduces the probability of females’ participation in formal sector.