In the 1990s, first projects emerged in Poland as first forms of PPPs. These involved municipal services and the construction/improvement of technical infrastructure facilities, and were mainly small investments implemented by local governments. At that time, the institution of public-private partnership did not formally exist within the legal system. In October 2005, the principles of public-private partnership in Poland finally became unambiguously defined. The new law settled the question of the nature and legality of PPP. However, the law was not used in practice, so its implementation may not be considered a success. On 6 of January 2009 President of Poland signed the new law about PPP. A new act promises a new direction in the use of public-private partnership by public and private entities. For many years, quasi-PPP initiatives have taken place, that is, projects that do not fall under public-private partnership according to the legislature, but from the point of view of their organization and objectives they are of such nature. Local governments are clearly interested in using this option, but a multitude of obstacles limits the implementation of projects in the form of broadly understood PPP. The existing state of infrastructure development and possibility of using EU aid funds should strongly encourage the use of PPP also in large-scale urban development and regeneration in cities. Authors investigated past and current obstacles existing by entering into PPP in urban development projects in Poland, non only of legal but also of socio-political nature. They aimed at presenting some solutions based on EU experience.