Keeping in mind that the fundamental task of local and regional governments is improving lives of
their citizens, this paper considers the phenomenon of smart specialization as a tool that can be used
to reach economic development and inclusion. Particular attention is paid to the impacts of smart
cities on regional life through establishing smart city networks and mutual cooperation of various
stakeholders. The issues associated with smart specialization are determined. At the same time, it is
attempted to suggest the possible steps that could be taken by local and regional authorities to foster
smartification. The multidimensional methodology approach is used for this study to increase its
comprehensiveness and wider applicability of the concluding recommendations. The research is
directly linked to the UN Sustainable Development Goals that are actively promoted by the Congress
of Local and Regional Authorities of the Council of Europe, so it is related to high practical and
theoretical value.