The paper discusses the notions and indicators of the economic growth and also development, as well as factors that influence the development process. In this context, the development management system is pointed out as one of the key development factors. Analysis of different dimensions of development management system identified horizontal management, management of development factors and meta-management as key dimensions. These same categories are also recognized at the level of local development management. In the Republic of Croatia, the local level of government is the lowest level of public government. It participates in shaping and controlling local development. On the contrary, it can be argued that it is also a key link in designing and ensuring overall local development, including economic development. The reason lies in the management stakeholders at that level of government. The local level is governed by those who live and work in that particular area. The society in which a certain local self-government operates is precisely the society that best knows the needs of that society. They know from their own experience what their place needs, and thus can most credibly assert priorities and dislodge development problems. After considering the existing management framework in which local governments operate in the Republic of Croatia, the research focused on the city of Trilj and its development problems and goals. Observing the limitations and shortcomings, as well as the positive sides of local management, we arrive at a clearer picture regarding the achievement of the desired goals.