In this paper are given adapted morphological, demographical and functional determinants of the Novi Pazar municipality development settlement network on the basis of relevant theoretical and methodological assumptions and qualitative and quantitative indicators. Municipality settlement network is observed as a subsystem in the settlement system of Novi Pazar functional area. Specifically are emphasized interdependency and conditionality of settlement functional transformation process, which caused differentiation of community area into an urban core-Novi Pazar, periurban ring- more or less suburban villages and rural surrounding. Suggested is a model of microdeveloping nucleuses as an instrument for community decentralization. On the ground of spatial and functional level of settlement integration some micro functional - micro regional structure of the municipality territory, has been identified.