Modern economies oscillate between periods of expansion and recession. Since, recessions have significant negative impact on production, investments and employment, thru history there were many attempts to predict upcoming recession and by conducting appropriate measures reduce its effects. Normally, for predicting recessions, authors use early warning indicators that should issue signals before the start of recession. However, global recession in 2008. has encouraged discussions why most of existing early warning indicators didn't detect the recession on time. The aim of this paper is to determine if financial and macroeconomic indicators can be used for early detection of an upcoming recession in post-transition EU countries or they will prove too unreliable to use. In order to achieve this objective, comprehensive analysis of existing literature needs to be made to identify majority of existing early warning indicators. Indicators will be selected in the research based on availability of data needed for their estimation. Data should cover at least period from 2006. so the global recession from 2008. can be analysed. Also, recession periods in post-transition EU countries will be determined using normal method of two consecutive quarters with decrease of GDP. Received results on recession periods will be additionally confirmed using Bry-Boschan (BBQ) algorithm. In this paper, three main hypothesis will be tested: • H1: Financial and macroeconomic indicators in post-transition EU countries generate warning signals at least 18 months before the start of recession. • H2: Foreign indicators generate warning signals of upcoming recession sooner than domestic indicators in post-transition EU countries. • H3: Financial indicators generate more accurate warning signals of upcoming recession than macroeconomic indicators in post-transition EU countries. For this, level of reliability of selected indicators will be determined by using signal approach. Additionally, selected indicators will be divided in specific groups depending on variables used for their calculation. Division will be on financial and macroeconomic as well on foreign and domestic indicators. Hypothesis two and three will be tested using Mann – Whitney U test and for hypothesis one multivariat probit regression of five most precise indicators will be made which will then be tested using Pesaran-Timmermann test. Received results will have significant benefit for stakeholders who make decisions based on information from early warning indicators. Primarily for government bodies which are in charge of creating fiscal and monetary policy. Issuing warnings about the upcoming recession allows government bodies to take corrective measures to prevent it or to significantly reduce its effects. On the other hand, imprecise indicators can lead to wrong decision which will have bad impact on the whole economy. Also, this paper will further extend existing early warning literature especially for transition countries which have been largely neglected in previous research, as well as providing comprehensive overview of existing indicators.