This final paper explains, in detail, an administrative - territorial organization of local units in the Republic of Croatia, which is somewhat specific due to a large number of counties, municipalities and cities. The paper will also distinguish the tasks, functions, jurisdictions and activities of the county as an autonomous unit of a local and state self-government in which there are 10-30 municipalities and cities. A budget is an act used to estimate revenues and expenditures planned for a certain time period. The term budget has become common in our everyday life because the the budget is one of the main concerns in public discussions. Also, the meaning of the term budget and its history will be clarified. The meaning of the budget itself will be defined as well as state budget and budgetary principles that serve as directions for accurate and transparent budget formation. In the eastern region of the Republic of Croatia, Osijek-Baranya county is geographically the largest, and for that matter, the most densely populated. The county includes 264 towns placed in 42 units of the local selfgovernment. Seven of them have a city status. The budget adoption of this county is of great importance not only for the city Osijek as its centre, but also for many smaller towns which depend on it. Most of the companies owned by the county are financed from its budget. The names of the institutions and companies governed by the county will be listed in the paper, together with the financing accounts, revenues and incomes together with expenditures and expenses of Osijek - Baranya county. Moreover, county's plan of a development strategy, which serves as a guideline for economic development and improvement of quality of life in the county itself, will be discussed at the very end. Key words: b