The article is devoted to the analysis of the prospects for the creation of the Balkan Union in 1904-1905, the idea of which arose under the influence of the aggravation of the international political situation in connection with the Eastern question, as well as due to the beginning of the Ilinden uprising in Macedonia. This was the first attempt in the twentieth century by young Slavic states to unite and coordinate joint foreign policy goals in the fight against the Ottoman Empire. The main sources of research are the diplomatic documents of the Balkan countries, as well as reports from Russian diplomats, the analysis of which led to the conclusion that the agreements reached during the negotiations between Serbia, Bulgaria and Montenegro, although they did not lead to the final formation of the alliance, still played a major role in the future and formed the basis of the Balkan Union of 1912-1913. They also stressed the role of the Russian Empire as an arbitrator in inter-Balkan relations. The main focus of the article is on analyzing the Serbian-Montenegrin negotiations aimed at concluding a union treaty between the countries and strengthening bilateral relations, which became possible after the change of the ruling dynasty in Serbia. Despite the fact that at first Serbian and Montenegrin politicians highly appreciated the importance of possible agreements, later negotiations failed due to serious disagreements between the parties on the issue of future territorial delimitation in the event of victory over the Ottoman Empire and the inability to work out a compromise text of the treaty. The conducted research made it possible to significantly complement and expand the picture of the Serbian-Montenegrin and inter-Balkan negotiations of 1904-1905 and to conclude that during this period conditions had not yet developed for rapprochement and coordination of foreign policy goals between the Slavic countries of the Balkan peninsula, and the beginning of negotiations on the formation of the Balkan Union was dictated to a greater extent by the temporary aggravation of the situation in connection with the uprising in Macedonia.