In today's competitive business environment the only way to survive is to stay in the arena or be ahead of others. It is well known that small and medium-sized enterprises are holders and key factors to raising the competitiveness of the economy. Through this work we shall try to understand the phenomenon of small and medium size enterprise (SME) internationalization. By examining various theories of internationalization and analyzing different entry modes to foreign market, by exploring motives behind internationalization and demonstrating the most common barriers to 'going international' we shall try to answer our main question. What are best practices of SME internationalization in Serbia?