The credit crisis of 2007-09 opened the unique opportunities for Islamic banks to emerge globally. Malaysia was one of the countries that were least affected by the crisis. Many analysts argued the reason for this is the early growth of Islamic finance. Malaysia has implemented the concept of Islamic banking in 1983. On contrary, Pakistan materially implemented this concept in early 2000. However, parallel Islamic banking industry is functioning in both the countries along with the conventional banks. The core objective of the study is to compare profitability determinants of Islamic banks working in Malaysia and Pakistan. The data was collected from Financial Statements of 8 full-fledged Islamic banks in Malaysia and 4 full-fledged Islamic banks in Pakistan for the period (2011-2017). Pooled OLS, Fixed effect, and Random Effect Panel regression analysis have been carried out to test the hypothesis and to compare the profitability determinants of both countries. Internal factors like Liquidity, Leverage, Efficiency, Size, and Asset quality were regressed against profitability. In addition to this, GDP per capita and inflation are also considered as macroeconomic factors in this study. However, the results show that macroeconomic factors, liquidity, efficiency, and size of Islamic bank affect the profitability of Islamic banks of both regions in the same manner. While asset quality and leverage is not a good predictor of profitability of Islamic banks in Pakistan due to developing phase of Islamic banking.