This paper focuses on analyzing the Croatian capital market within the context of the European Union (EU). It covers key aspects of Croatia's accession to the EU, the impact of that membership on the financial sector, as well as the development and current position of the capital market in Croatia. Additionally, it examines how European standards and regulations, such as MiFID II and UCITS, influence the Croatian market, including the adjustments required to align with EU regulations. Croatia's entry into the EU brought numerous advantages, such as increased access to capital and heightened interest from foreign investors. However, various challenges are also noted, including the need for further adaptation and maintaining competitiveness. In conclusion, the paper provides an overview of the positive and negative impacts of EU integration on the Croatian capital market and offers recommendations for the future development and improvement of this sector. The aim of the paper is to provide a comprehensive analysis of the current state of the Croatian capital market and to propose guidelines for its enhancement within the European framework.