Abstract: Promotion of use of renewable energy sources are among the priorities of energy policy in Lithuania. District heating (DH) technology is promising tool for implementing energy and environment policy goals. Lithuania acceded to the European Union (EU) in 2004. Integration of new member states to the EU has created a new situation in the frame of implementation of EU sustainable development. At the moment the use of renewable energy is relevant for Lithuania not only for sustainable development targets, but also for practical reasons. After the closure of Ignalina Nuclear Power Plant Lithuanian energy sector development faced with significant challenges. Energy sector, including district heating, became dependent on natural gas. Lithuania imports natural gas from the sole energy supplier - Russia (Gazprom). New challenges for district heating sector are related to the possibilities of integration of renewable and local energy resources. A wider use of renewable energy can help to diversify of energy supply and to meet the targets of sustainable development. The paper presents an overview of the present Lithuanian and EU legal regulation of the use of renewable energy sources. Also the problems related to the use of renewable energy sources in district heating supply and measures that promote the use of these sources are analysed in the article.