In this paper, the topic of local economic development is elaborated on the example of the town of Dugo Selo. The development of locations and regions is particularly important due to the need for decentralization of the Republic of Croatia. Local and regional environments are given increasing importance due to the general trends of globalization. The aim of this paper is to explain the importance of local development, to clarify the concept of local self-government, and to explain in detail the purpose of adopting strategic development plans. The strategic development plan of the city of Dugo Selo will be presented, all the advantages and disadvantages, as well as the risks and opportunities of the city itself will be analyzed. Using the example of the city of Dugo Selo, the importance of the local economy will be explained, and how important it is for every city to have a development strategy in order to determine goals and priorities. The city of Dugo Selo was taken as an example, because it is a city that has developed strongly in all segments in the last ten years. It is characterized by a high birth rate and a young population, however, it faces all the challenges of increased housing construction due to the influx of population, and infrastructure problems. The city of Dugo Selo, through the adoption of two strategies of city development plans, has shown that it is ready to improve its local economic development and become one of the best small cities in the Republic of Croatia for the quality of life of its citizens, and is certainly a good example that other local governments should emulate.