This article examines how perceived innovation characteristics influence the adoption of Time-Driven Activity-Based Costing (TDABC) in Malaysian private higher education institutions (PHEIs). Drawing on Rogers’ Diffusion of Innovation framework, the study focuses on relative advantage, compatibility, complexity, trialability, and observability as key explanatory factors. Using survey data from 316 decision-makers and finance-related personnel in Malaysian PHEIs, structural equation modelling was employed to test the proposed relationships. The findings indicate that relative advantage, compatibility, trialability, and observability exert significant positive effects on TDABC adoption, while perceived complexity shows a negative influence. These results suggest that adoption decisions are driven not only by technical superiority but also by how clearly benefits can be experienced, tested, and aligned with existing practices. The study contributes to management accounting literature by extending diffusion theory into the higher education context and offers practical insights for university leaders seeking to enhance cost transparency and financial sustainability through TDABC.