In conditions of market reforming in all development directions in Smolensk region, there are changes concerning the conditions, rules and principles of branches functioning in social and economic development of the region and its government. The main focus is on the development of only two industries working for export – electricity production and mining industry. The region is located in Non-Black Earth Region and requires investment for the development of its agricultural sector. Therefore, it was decided to eliminate the sphere of agricultural sector, which in pre-perestroika period provided the domestic demand of the country population in pre-perestroika period. Agricultural sector also provided Far East and Polar regions. However, nowadays agricultural production is aimed only at meeting domestic regional demand. Even after the reforms, agricultural sector and its basic part farming continues to be a small island of real business working for domestic demand. It is a backbone component for the economy of Smolensk region, a source of labor market and force application of region rural population. It ensures its food and economic security and has a high potential for rural development. However, at present its position is in a state of crisis, which is associated with low procurement prices for perishable products, the elimination of a processing system and purchase of agricultural raw materials, seed stock, breeding farm, lack of own production of feed additives and animal feed; care of qualified personnel and specialists from the industry and deterioration of the social base (elimination of schools, settlements, hospitals and medical assistants, culture establishments). At the same time, the tasks are set to ensure food security in the context of sanctions, which leads to a noticeable revival of the industry. There are new concepts in industry regulation at the regional level, transformations in management methodology and interaction mechanism for all levels from modernization to processing of end products in accordance with the requirements of the country’s development.