Anti-dilution is a provision in certain securities and options that protects an investor from dilution if the issuer later sells shares at a lower price. This provision is commonly used by more sophisticated investors to keep their ownership interests in an investee from declining in situations where the valuation of the investee is decreasing. It most commonly provides for a reduction in the conversion price at which a preferred stock holder can convert his or her holdings into the common stock of the issuer.

The term also refers to the increase in earnings per share or decrease in loss per share that results when one assumes the conversion of convertible instruments, the exercise of options and warrants, or the issuance of common shares if specified conditions are satisfied.