This paper explores the development of local self-governance in the Republic of Belarus. Attention is paid to the theoretical foundations of local self-governance, advantages and disadvantages of decentralization, assessment of its impact on economic growth, to the analysis of the existing system of local self-governance in the Republic of Belarus, including directions for its improvement. The main advantages of decentralization of local self-governance are the reduction of corruption, taxes and the size of local administrations, as well as informational advantage of local authorities on the needs of local population. The development of local self-governance should be directed to the implementation of deconcentration of the administrative-territorial division, reasonable centralization of local Executive Committees in combination with real empowerment of local Councils of deputies, to the improvement of the mechanism of alignment and balancing of local budgets, as well as development of the financial base of local financial management and intergovernmental relations.