Sustainable development comprises the balanced development of many economic and social processes, demonstrates strong resistance to changing economic transformation, internal and external economic dangers, global impacts, ensures stability of the national economy and promotes economic growth, strengthens the country's competitiveness. After the collapse of the Soviet Union, Azerbaijan was also one of the 15 countries that got independence on 18 October 1991. In the early years of the independence, Azerbaijan faced with economic, political, social and environmental challenges during transition from centrally planned economy towards market-oriented economy. Comparative analysis of former Soviet Union countries are also included in the thesis to examine Azerbaijan’s performance among them in terms of economic and social indicators.