The study of corruption is now a serious subject in the development discourse. Wolfensohn, the former president of the World Bank argues that corruption has become "the largest single inhibitor of equitable economic development." Moreover effects of corruption extended to all countries, Nobel Prize –winning economist Amartya Sen wrote in 2009 that lack of transparency in the global financial system was among the main factors contributing to the financial crisis that began in 2008. The purpose of this paper is to analyze the impact of corruption on economic growth and importance of the transmission channels in Algeria for the period of 2001- 2012. Based on the empirical framework, In our ordinary least squares estimations, we find that, the significant and negative effect of corruption on investment and public spending. The Results indicate also the negative and significant relationship between corruption and economic growth in Algeria.