It is possible to give several connotations about the meaning of development. In short, achievement a considerable decrease in poverty, unemployment and inequality can be interpreted as development for the country considered. Of course a sound development cannot be specified purely economic terms. It must be included, adequate educational level, freedom of speech, and citizenship of nation that is truly independent both economically and politically. Most of the developing and less-developed countries are characterized as rural nations where most of the people are living in rural areas and engaged mainly in agriculture. That is why rural development inevitably is a major challenge for these countries. Improvement of agriculture from a traditional- subsistence structure to a modern-commercialized ones have created some new problems such as unemployment and ultimately a migration from rural areas to urban centers. There were a lot of experiences, which show us, rural development project, which only aimed at only improvement of agricultural structure, have not been very successful to reach the general nations' development targets. In recent decades, a new approach appeared that is aiming at to achieve a rural development considering all sectors together in the economy and also social advancement. Among the others, development of industry not only agricultural based and also other small and medium scaled industries which are located in rural areas has been considered aiming at creating new employment (NAE=Non -Agricultural Employment) opportunities. It is well known that, especially after the World War II cooperatives were used as an instrument of development policy and rural industrialization. One of the worldwide examples was the case of Israel. Cooperatives can make contribution not only to the rural industrialization but also to other economic, social and political development of a country.