Developing territories in accordance with the principles of sustainable land development is easier and more effective together with the people who directly use these lands, as well as executive authorities, who, with the involvement of the public, know, understand, and implement changes. For reasonable and prompt decision-making on land issues, the territorial communities must have up-to-date information support with data about all land parcels and property within the boundaries of territorial community. Industrial lands deserve special attention, because due to their rational use, it is possible to achieve an increase revenue to local budgets. Today, the state of industrial lands in Ukraine is negatively affected by the presence of a significant number of industries that require modernization, including infrastructural transformations with the provision of further balanced consideration of the ecological component of the territories' sustainability. The purpose of the work is to substantiate the principles of determining and changing the target designation of industrial lands within the territorial communities to improve their functioning and ensure their competitiveness. The development of urban planning documentation is a mandatory prerequisite for changing the purpose of industrial land of the territorial community to another purpose and vice versa. Management of the development of territories today directly depends on the planning structure and functional zoning of settlements. The changes of legal acts should have been taken effect from July 2021, but inconsistencies were found in the legislation of Ukraine, which relate to the functional zones approved by the comprehensive spatial development plan of the territory of territorial communities, within which the change of purpose must take place. Due to the introduction of martial law in Ukraine, the pace of development of urban planning and land management documentation slowed down, and as a result, today there is no any approved comprehensive spatial development plan. That is, it has been 2 years since the changes came into effect, but the change of the land purpose is carried out according to the old procedure with the development of land management documentation. Taking into account the above-mentioned components, the authors identified three main prerequisites for changing the target purpose: 1. The needs of industrial enterprises in the context of modern economic challenges. Changes in technology and production practices may require adaptation of land use to ensure the efficient functioning and competitiveness of enterprises. 2. Integration of social aspects into the decision-making process. It is important to consider the impact of these changes on local communities and ensure citizen participation in the process of determining the future use of industrial land. 3. The need to settle environmental issues. The change of purpose must take into account the potential effects on the environment and natural resources. Based on the prerequisites described above, the authors developed the principles of industrial land transformation, which take into account the principles of sustainable development. By following the developed principles, stakeholders can guide the transformation of industrial land in a way that maximizes benefits, minimizes negative impacts and promotes sustainable development.