This study aims to firstly develop a brief review of the creation and functioning of the European Grouping of Territorial Cooperation (EGTC), highlighting the role of the EGTC in respect of its contribution to the harmonious development of the whole European Union through the strengthening of economic, social and territorial cohesion. The article highlights recent changes in EU legislation governing the EGTC and analyses the infl uence that there is in choosing the State where a Gro uping will be located, and the applicable law. Subsequently, the article outlines the contribution of those EGTCs — constituted by municipalities in Romania and Hungary — to regional sustainable development. Utilising a cross-border EGTC is a way of promoting of better neighbourliness, and stimulating balanced economic development and social stability by harnessing local resources and regional joint projects. At the end of the article I stress the need for cross-border cooperation between Romania and Hungary in developing services of general economic interest, as well as transport infrastructure and tourism.