Amongst all the 65 participating economies in PISA 2012, Macao is high up in the league table of grade repetition. The data shows that 43 percent of Macao’s 15-year-olds repeated one or more years in their primary and/or junior secondary years of education. Although it is not feasible to use the data to ascertain the causes of grade repetition, based on the student’s responses to the questionnaire, it is possible to uncover the underlying processes and mechanisms mediating the effects of grade repetition on mathematics literacy performance. After adjusting for the effects of gender, ESCS (Economic, Social and Cultural Status) of the sampled students and demographic characteristics, a number of mediating variables pertaining to student’s learning mathematics, mathematics experiences, problem-solving experiences, availability and use of ICT, and classroom and school climate have been identified. Implications of study are discussed.