Creative economy is the economy of the twenty-first century. The advancement of globalization and americanization lead to the development of the creative economy in its entirety. As a domino effect, these two phenomenons are responsible for the establishment of the creative economy as an autonomous system, that is industry. The words creativity and economy in itself don't necessarily go together, and are not new terms that appeared on a global scale, but jointly they contributed to the development of new branches of industry: creative and cultural industry. Appearance of these two industries brings new job openings, opportunity for investment and profit, development of culture within society and encouraging one of creativity. The objective of this research was to study the effect of creative and cultural industries and their development in Europe and the Republic of Croatia, as well as clarification of certain terms and movements within the development of these industries. The main branches of these industries emanate from a combination of two movements: creative arts and cultural industries. These two phenomenons encourage the importance of knowledge and intellectual property. Even though the Republic of Croatia maybe isn't as developed as the rest of the countries in the European Union in these areas, from the enclosed data you can see that these industries are not ignored, and that they are invested into and have the potential for growth and development. Nonprofit organizations are not ignored as well and, on the contrary, they are invested into and are a part of growth of the society in the Republic of Croatia, as it can be seen from the enclosed data.