Sustained provision of sufficient financial resources for environmental investments is a prerequisite for addressing environmental challenges in the Republic of Croatia. It is of high importance to set out optimal use of the various available sources of environmental finance, including domestic public expenditure, international assistance, loans from international financing institutions and financial contributions by the private sector. Governments need to prioritize the environment in public expenditure framework and create suitable climate for the private sector participation in environmental financing. The international community must ensure more accessible loans from international financing institutions for environmental investments and provide grant co-financing possibility. Private sector involvement requires the establishment of mechanisms that will facilitate private sector contributions to public sector infrastructure projects.