Abstract A holistic perspective of various energy stakeholders regarding the Strengths, Weaknesses, Opportunities and Threats (SWOTs) of the energy sector in Macedonia is utilized as baseline to diagnose the current state and to sketch future action lines towards sustainable energy development. The resulting SWOT analyses pointed to the progressive adoption of European Union (EU) standards in energy policy and regulation as the most important achievement in the energy sector. The most important problems the national energy sector faces are scarce domestic resources and unfavorable energy mix, low electricity prices, a high degree of inefficiency in energy production and use, as well as insufficient institutional and human capacities. The formulated portfolio of actions towards enabling sustainable energy development urges the adoption of a comprehensive energy strategy built upon sustainability principles, intensified utilization of the natural gas, economic prices of electricity, structural changes in industry, promotion of energy efficiency and renewables, including Clean Development Mechanism (CDM) projects, enforcement of EU environmental standards and meeting the environmental requirements, as well as institutional and human capacity building.