Achievement　of　sustainable　competitive　position　and　superior　performance　is　the　first　priority　of　business　organizations.　However,　small　firms,　due　to　fairly　known　reasons;　lack　of　resources,　financial　capabilities　and　lack　of　managerial　skills　are　often　unable　to　succeed　in　their　mission.　Hence,　they　often　look　for　less　risky　and　convenience　sources　to　compete　in　the　market.　A　variety　of　factors　has　been　tested　towards　a　firm　competitive　position　and　performance　but　the　role　of　government　support　in　this　perspective　has　received　minor　attention.　The　present　study　examines　the　influence　of　government　financial　support　and　nonfinancial　support　on　firm　performance　with　mediating　role　of　the　sustainable　competitive　position.　Hypotheses　were　tested　using　structural　equation　modeling　in　Analysis　Moment　of　Structure　(AMOS)　on　a　data　set　of　326　Pakistani　Small　and　Medium　Size　Enterprises　(SMEs).　The　results　indicate　that　government　financial　and　nonfinancial　support　have　a　significant　influence　on　sustainable　competitive　position　and　firm　performance.　Additionally,　a　sustainable　competitive　position　partially　mediates　the　relationship　between　government　support　and　firm　performance.　Government　bodies　and　policy　makers　are　advised　to　provide　financial　and　nonfinancial　support　to　SMEs　which　in　turn　can　upsurge　economic　growth　and　sustainability.