Small industries play a strategic role in supporting local economic growth, particularly in regions where the economic structure is dominated by micro, small, and medium enterprises (MSMEs). This study aims to analyze the role of small industries in driving the local economy in Gresik Regency. The method used is a descriptive qualitative approach with data collection based on secondary data from the Central Bureau of Statistics (BPS) and direct observation in the research area. The results show that small industries make a significant contribution to job creation, increased community income, and the strengthening of the local economic structure. In addition, small industries also play a role in reducing unemployment and promoting more equitable economic distribution in Gresik Regency. However, there are still several constraints such as limited capital, marketing access, and a lack of innovation and technology that hinder the optimal development of small industries. Therefore, more directed local government policy support, improved access to financing, as well as training and mentoring for business actors are needed so that small industries can develop more sustainably.