Small islands compare at the top of the world in blue economies, where their economic development relies on marine resources and specifically their challenges, susceptibility to climatic changes, insufficient land, and tourism. Effective governance plays a central role in ensuring good blue economy that is sustainable and in which there is a balance between economic development, social justice and sustainability. This chapter will look at why effective governance contributes to the sustainable development of blue economies of small islands. It outlines the role of good participatory decision-making, transparency, accountability and rule of law in governance of marine resources. The article pinpoints the best practices in optimizing policymaking, stakeholder cooperation, and adaptive management to tackle the challenges of overfishing, marine pollution, and destruction of the habitat. The results offer practical implications to policymakers, practitioners, and researchers interested in including the theme of good governance in the marine economic plan of action at small islands to guarantee future prosperity of island populations and the sustainability of their distinctive marine ecosystems. Additionally, this chapter ends up with the following conclusion that inclusive governance, revolutionary policies, and sustainable practices must go hand in hand to release all the blue economy potential in small islands to serve as the model to be used in other coastal and maritime territories across the globe.