The literature shows evidence that small and medium enterprises (SMEs) are understood as main source of technology development and employment creation. At the same time they are vulnerable to a number of restrictions such as access to finances, skilled labor and public support, while are exposed to high competition and suffer from low survival rate. This research aimed to shed lights on the role that SMEs play in the process of industrial and economic development of Kurdistan province of Iran. Based on the findings from the empirical result and those in the literature, appropriate policy recommendations to improve the conditions of SMEs infrastructure and performance are provided.