Contemporary trends in education have stimulated the existence of numerous competences and skills among preschool institutions. For years, those competences and skills were not implied nor required as special with the goal to improve learning and to motivate the education and upbringing of children. Such circumstances especially require the management in education. The purpose is to organize the work in the best manner so that human and material resources in the institutions are applied in the most appropriate manner. The manager in preschool institutions take care about the planning, setting goals, work organization, assignment delegation, motivation and engagement of the employees as well as administrative and financial plans of the organization. Persons with such skills are needed in the institutions for earliest upbringing and education of the youngest. That is especially noticeable in the countries which are in the development and transition process, like the Republic of Serbia. The paper represents the importance of management in education, its benefits and requirements for its development. This paper also signals that many employees of the preschool institutions require managerial competences. The paper represents certain hurdles which may appear, as well as the flaws in the system of preschool upbringing and education which can be overcome successfully with the work of a manager. The constant cooperation and communication at all levels is emphasized.