Abstract: Montenegro is a small country bordering the Adriatic Sea with the coastline of 293.5 km, and topography characterized by large hilly mountainous areas with distinctive relief and only small areas of lowland. The terrains of olive growing areas are either sloped with very high inclination or foothills of the mountain massifs of Orjen, Lovcen and Rumija. Favourable environmental conditions prevail on the Montenegrin seaside enabled the olive to become the leading species in the coastal area. With about 450,000 productive trees is spread at around 3,200 ha. It is dominantly traditional culture (70%) grown on family farms. New olive groves present approximately 10% of total olive growing and are increasing. The olive assortment is composed of autochthonous varieties in which variety Zutica dominate, approximately 65%. There are around 5% of introduced foreign varieties, Picholine, Coratina, Leccino, in the new groves, and Arbequina variety for high density orchards. The production of olive oil is relatively low (below 500 t), making Montenegro importing country for additional 300 t per year. There are much bigger capacities for oil production, of around 2,000 t, which can significantly reduce the import by increasing of domestic production and utilization of existing capacities. Consumption per capita is low, except in the coastal area where every day diet is based on olive oil, also due to the price of 8-15 Euro per liter. There is also a limited production of organic olive oil. Plant protection influences very much the olive growing, olive production and olive oil quality. However, the olive protection is conditioned by the terrain structure, traditional olive groves and small properties. Monitoring of major pest, olive fly, is performed by Plant protection department in collaboration with olive growers Association and Extension service. The olive oil processing technology has been changed significantly in the last decade. Nowadays there are only 11 traditional mills active and 15 two-phase system plants have been introduced. The processing facilities improvement is followed by improvement of the condition for olive oil storing. The olive oil quality control is based on determination of the basic quality parameters. However, recent equipping of the laboratory at Biotechnical Faculty with GS and HPLC, extended the range of analyses for the market, as well as for scientific purpose as in characterization of olive oil of local varieties. Montenegro is very rich in agricultural genetic resources and olive germplasm as well, considering the small area covered. There are the oldest exemplars of the old trees in the region and beyond, the ‘Old Olive’ in area of Bar, estimated to more than 2,000 years old and protected by law, and the ‘Velja maslina – ‘Great olive’ in area of Budva, and numerous other exemplars. Characterization of local varieties on morphological and molecular level, clone selection of the major variety and preservation of olive genetic resources are big challenges for Biotechnical Faculty. Furthermore, the area of Montenegro coast as the main olive habitat is threatened by the construction of tourism facilities. From the other side, the olive is the basis for the coastal rural tourism. The important ways to market olive oil are through the tourism, and through organized Mediterranean diet, providing great opportunities and challenge for the olive oil sector.