In order to understand the concept of the strategy, it is important to be familiar with its principal characteristics, that is, the method in which some resources should be used to exploit the benefits of the convenient circumstances to reduce the difficulties working toward the desired outcomes. The financial resources as well as the supporting institutions are indispensable for its successful implementation. The subject of the study of this final work is the development strategy, the strategic planning, the strategic objectives, the state/environment analysis through SWOT and PEST analyses, and the analysis of the financial reports in the example of the Municipality of Dugopolje. The development strategies, the long-term strategic objectives, the mission, the vision, as well as the analysis of the internal and the external environment, that are the basis of the strategic planning, are as well stated in this diploma thesis. The objectives were determined through the findings of the stated analyses of the possibilities and restrictions in order to achieve the objectives set by the Municipality. The ultimate objective of the successful strategic development of the Municipality is to implement its development strategy through projects and clearly stated goals.