An important aspect that influences the regional development is the possibility of the municipalities to implement their development planning documents, inter alia by using the European Union (hereinafter - EU) funding. Most of the EU funds activities are designed based on sectoral priorities and cover only one sector. Moreover, the support offered does not always correspond to the needs and interests of the municipalities; it is impossible to adjust it to local specificity. At the same time, those municipalities which are the financial beneficiaries in EU funded priority Polycentric Development have the opportunity to implement and coordinate in time, space and across sectors projects that are important and necessary for the development of the particular territory. However, mostly these projects refer to the creation of attractive living environment, not the stimulation of economic activity. Thus it is important to stress the economic dimension in the local development programmes. The aim of the article is to evaluate the development programmes of Latgales region’s municipalities based on their experience in the EU funding programming period 2007-2013, as well as to compare the usage of EU funding according to territorial and sectoral approach.