Primary wood processing and secondary furniture production are strategic sectors in most western Balkan countries with regard to contribution to gross domestic product, exports, and employment. After abandoning a socialist business system in the post-Yugoslavia era, all countries in the region have developed transitional reforms to become free-market economies. Some of these reforms include changes in ownership structure, recapitalization and modernization, adapting to meet import standards of developed countries, and developing strategic linkages with supply-chain counterparts in developed countries. This article contains the results of research conducted on the current situation in primary wood processing and furniture industries in seven western Balkan countries. A common characteristic of these sectors across all countries is the century-long tradition of forestry and forest utilization. The development of these sectors will require sustainable management of the region's rich forest resources, political and economic systems that are transparent and market driven, as well as investments in production technology and employee training.