Decentralization is usually an organizational tool, a process of reducing the center’s influence on all parts of the administrative system; in political terms, state power is assigned to local authorities and bodies. Decentralization of execution, decentralization of execution and decision-making, and decentralization of execution, decision-making and partial supervision of transfers are at the highest level. Regionalization and the creation of a multi-level public administration system is one of the new trends throughout Europe. It means strengthening regional awareness, sense of identity, and belonging in certain large regions within the nationstate and strengthening regional institutions by creating regional political representative institutions and other institutions in the autonomous areas, giving these institutions political autonomy. In many European countries, the role of regional units is strengthening as one of the phases between the central state and local autonomous governments. The issue of this thesis is the reform of local self-government in the Republic of Croatia and whether the process of decentralization as a new approach to the development of local and regional self-government will increase the efficiency of public administration. The Republic of Croatia is in dire need of decentralization of public administration and the activities it deals with, which would become more efficient and effective in the performance of its tasks in regionalization. This paper analyzes the concepts of decentralization and regionalization in the European Union and in Croatia. The practical part of the paper explores the decentralization and regionalization of European countries: Germany, France.