The settlements of Sokobanja municipality underwent intensive changes in the second half of the 20th century. These changes were manifested on all components of demographic development and caused the alterations of the functional type of settlements .This work discusses the functional transformation of the settlements of Sokobanja municipality in the period from 1953-2002. Applying the quantitative methods ,it has been established that these changes led to the decrease in the share of purely agrarian settlements and the increase in the share of agrarian -service-providing and purely service-providing settlements. .