The metals and metalworking sector are still one of the more important sectors in Republic of Macedonia, though they have gone through the serious challenges as a result of the global economic crisis. The data show that the total export value of these two sectors in 2016 is 536.4 million US $, while the relative share in country’s export is more than 11.3%. The results of our research indicate that the number of exporting products within metals and metalworking sector in 2016 is 312 out of total 589 products which are subject of world trade within these industries according to 6-digit HS classification of products based on UN ComTrade statistics, while the number of products that are exported with comparative advantages (RCA>1) in the same year is about 47 products. Moreover, if we compare this number with the total number of products that country exports with comparative advantages in all sectors (460 products), we can conclude that more than 10% of total exporting products that Republic of Macedonia exports are coming from metals and metalworking sector. These results show that these sectors have significant role for Macedonian economy and more importantly they have huge industrial potential for further export diversification (increasing the number of exporting products within these sectors) and inter-structural upgrading (moving from products with lower added value to products with higher level of sophistication). In this context, the main aim of the paper is to explore the question „what are the main industrial opportunities of metals and metalworking sector? And how production and export structure of these sectors could be upgraded?” To answer this question and to fulfill the main goal of the study we are investigating the current production and export structure of these industries at product level by using the product space methodology and several empirical indexes (RCA and PRODY). Additionally, we are searching for new more sophisticated products within these industries that country has latent comparative advantages to start exporting to other countries in the region and beyond based on the estimation of PROXY index.