This paper analyses the status quo and characteristics of development of private economy in Tibet, the private economy shows the momentum of rapid growth and is the main force for promoting prosperity of urban-rural market, becoming an important source of fiscal revenue and a major channel for social employment. The main factors restricting the development of private economy in Tibet are generalized as follows, first, the natural environment is inclement, and it is under great pressure of ecological resources; second, the development level of private economy is low with shaky foundation and small production scale; third, the laws, regulations and preferential policies have not been implemented well, and the supporting policies are yet to be improved; fourth, there is a dearth of financial support, and the individually-run enterprises yearn for capital; fifth, the workers' quality is low, and the management level of private economy is not high. Finally, the countermeasures and proposals are put forward to accelerate development of private economy in Tibet as follows: improve ecological environment, transform the pattern of economic development; implement well the relevant laws, regulations and preferential policies, perfect the supporting policies; strengthen the financial support, promote the development of private economy; improve the quality of workers in private economy, foster large quantities of entrepreneurs worth their salt.