Local government has the long tradition of its existence, so it was over decades and centuries subject to changes its structure, domain and territory in all of the members of European Union, either in legislational or institutional aspect. The European Union is supranational community which creates and implements various policies of society and economy in order to be able to achieve equal prosperity for all of the european citizens. Because of the cotemporary tendency for performing public duties at the level closest to citizens the local government is the prime participant for implementing european cohesion policy and it's the most important level of authority for the sufficient regional development. Regional development is the process of general society and economy evolvent in the aspect of European funds and it's the main purpose that is to be achieved by financing projects with european structural and investment funds. When the Republic of Croatia has bacame a member of the European Union, that opened up an opportunities for usage of this european structural and investment funds. An eligible users of this funds are wide range of individuals and legal entities; public bodies whether local, regional or national, non-profit organisations and civil society. The funds of European Union are classified in a long-term budget which covers a period of seven years and this funds are allocated in a national budgets of its members in accordance its development index. On that way European Union strives to standardize the development of its members, it provides financial support to regionas that are less developed, so they could reach european standard of living. Therefore, the aim of this paper is to show the role of Croatian local government for regional development, precisely through the use of European structural and investment funds.