The paper titled “Solutions to Enhance the Efficiency of Local Development Investment Funds in Vietnam” examines the role and operations of Local Development Investment Funds (LDIFs) in the context of infrastructure development within the budgets of Vietnamese provinces and cities. These funds play a crucial role in mobilizing resources, engaging private economic entities, and supporting economic and social infrastructure projects. The paper evaluates the current status of LDIFs, highlighting their achievements, limitations, and challenges. The study proposes a comprehensive set of solutions to enhance the effectiveness of LDIF operations and improve their impact on local economic and social development. The introduction provides an overview of the fiscal challenges faced by the government and localities due to overspending within permissible limits. The second section details the current situation of LDIF operations, presenting statistics on their capital, lending activities, investments, and engagement with other financial funds. It underscores the achievements in capital accumulation, lending, investment, and entrusted activities, while also pointing out limitations such as restrictions on capital mobilization, small fund sizes, non-performing loans, and challenges in investment activities.To address these challenges, the paper presents a set of solutions in the third section. The proposed solutions aim to enhance the effectiveness of LDIF activities and ensure they contribute optimally to the ongoing efforts of building prosperous provinces and cities in Vietnam. The paper references various sources, including reports from the Association of Local Development Investment Funds, government decrees, academic journals, and research articles, to support its analysis and recommendations for improving LDIF operations.