In Croatia, social entrepreneurship is still at the beginning of its development. Social entrepreneurship is a relatively new phenomenon, both in the world and in Croatia. In recent years, the potential of social entrepreneurship in solving many social problems has been highlighted. Croatia is characterized by high unemployment, which brings an increased risk of poverty and social exclusion. Vulnerable social groups, such as the long-term unemployed, young people and people with disabilities, are particularly vulnerable. This paper will deal with the presentation of the possibilities of social entrepreneurship in the field of inclusion of vulnerable groups in the labor market, and thus in society in Croatia. That is also the goal of this paper. The first part will present the development of social entrepreneurship in the world with an overview of different ways of defining the concept. Different types of social entrepreneurs will be presented and social entrepreneurship will be distinguished from traditional entrepreneurship. The second part of this paper will explain the development of social entrepreneurship through the evolution of social policy and the emergence of welfare mix. The role of social entrepreneurship in the field of social policy will also be presented, with reference to the description of work integration social enterprises (WISE). The third part deals with the characterization of vulnerable groups in Croatia, with an emphasis on the long-term unemployed, young people and people with disabilities. Special attention is given to their social position and position on the labor market in Croatia. The fourth part presents the historical development of social entrepreneurship in Croatia with an overview of the most important events and characteristics of this phenomenon. The last part deals with the possibilities and potentials of social entrepreneurship for the inclusion of vulnerable groups in society and the labor market, with an overview of current policies dealing with their inclusion in the labor market and examples of good practice of social entrepreneurship for vulnerable groups. Finally, it is concluded that social entrepreneurship in Croatia is in its infancy and emphasizes the importance of informing and educating about the possibilities of social entrepreneurship in order to achieve greater public visibility of the area.