This report examines both the challenges and the opportunities associated with designing and using indicator systems as a tool for the governance of regional development policy. It draws on the experiences of a number of OECD countries and provides an in-depth look at the cases of Italy, the United Kingdom (England), the United States and the European Union.  It builds on previous OECD work on the governance of  regional development policy by extending lessons about contractual relations among levels of government to performance indicator systems.