The article focuses on the role and importance of the activity of local governments in the economic development process of the Council of Europe member states, taking into account the specific role of the Congress of Local and Regional Authorities of Europe. In the context of contemporary economic and social challenges, the effectiveness of actions taken by local governments is analysed, taking into account the specific impact of the Congress on shaping regional policy. The article is based on case studies and an analysis of the practices of local governments from selected member states of the Council of Europe, with particular emphasis on the role of the Congress of Local and Regional Authorities of Europe. In the context of global trends, the article points to the importance of the Congress as a platform to exchange experiences, coordinate activities and represent the interests of local governments at the European level. It also presents tools and instruments that the Congress can use to support and stimulate the activity of local governments, such as initiating inter-sectoral dialogue, promoting international cooperation and promoting standards of good practice in local management. In addition, it analyses the challenges faced by the Congress in the context of increasing the effectiveness of its activities.