Russia's economy is currently facing long-term systemic challenges reflecting both international trends and internal obstacles to development. Among them are more intense global competition, new wave of production methods, exhaustion of the development model based on raw materials export, etc. Therefore modernisation of the industrial system is seen as very important at the present moment.
The industrial system of Russia consisting of hundred thousands of the highly specialized enterprises, was supported in balance due to the centralized redistribution of resources. Sharp transition to market economy resulted in considerable difficulties which increased up to the middle of 1999. Only since 2000th there is a revival of the Russian economy and restoration of the main macroeconomic indicators. However, despite activation of the measures undertaken at various levels of management, in development of industrial sector of economy there is a number of the factor constraining its development. In this regard research of the main tendencies and prospects of development of industrial sector of economy and justification of recommendations about increase oа its functionality in modern economic conditions is represented actual.