Social Entrepreneurship is a specific form of entrepreneurship that simultaneously integrates economic and social values, complements services that are of public interest, contributes to the allocation of resources for the benefit of the community, responds to the needs of socially sensitive groups and promotes social cohesion and as such directly affects the economic development of a particular community. This paper gives an insight into the conceptualisation of social entrepreneurship with an overview of the development of this phenomenon and the presentation of definitions and characteristics of social entrepreneurs and social enterprises. This is followed by a presentation of social entrepreneurship within the context of the European Union with an emphasis on the European Social Fund, one of the main instruments of the European Union's cohesion policy, which actively supports social entrepreneurship through financial and other forms of support. The emphasis is on the development of social entrepreneurship in the Republic of Croatia, on the institutional and legal framework and the latest processes in the development of social entrepreneurship, as well as the presentation of practice of several successful social entrepreneurship enterprises. In this context, the Strategy for the Development of Social Entrepreneurship in the Republic of Croatia in the period from 2015 to 2020 is also mentioned, which was initiated by the Ministry of Labor and Pension System who recognized the importance and potential of social entrepreneurship in encouraging employment, providing social services and contributing to socioeconomic development of the Republic of Croatia, which represents a milestone and an important step in the creation and implementation of public policy for social entrepreneurship.