Radical political and economic changes in Russia have been accompanied by reforms with regards to the legislative base, the system of forest management and formulation of new forest policy. This paper presents a brief analysis of recently adopted forest legislation and the problems that exist in forest management, forest utilisation, protection and regeneration of forest resources. Lack of co-ordination of federal and regional legislation and the resolution of a number of questions that have significance with regards to development of the forest sector are discussed. The main focus is on improvements to the legislative base and the organisational structure of forest management during the transition to a market-based economy. The primary issues include: (1) determination of the forms of forest ownership and differentiation of the forest fund by forms of property; (2) differentiation of the jurisdiction of federal, regional and local authorities in the regulation of forest relationships; (3) reconciliation of the economics of forest management with methods of national regulation, and (4) determination of sources and mechanisms for forestry financing. Improvement and maintenance of forest sector information databases are considered prerequisites for the development of forest management and forest policy in Russia.