This study aims to determine the role of Islamic banking in the development of the performance of small and medium micro enterprises (UMKM) in the city of Yogyakarta. The role of Islamic banking is measured through financing and assistance. This study uses a quantitative method with a descriptive analysis approach. This type of research is carried out directly in the field (field research) conducted at the place of business of respondents which obtained from the data of Bank BRI Syariah in the city of Yogyakarta. The sample in this study was financing customers as much as 100 respondents. The type of data source in this study uses primary data, while the technique of collecting data is by questionnaire. The results of the study show that the role of Islamic banking in improving the development of the performance of small and medium micro enterprises plays an effective role. The variables in this study are financing, assistance, and the performance of UMKM. From the tests carried out by author, the financing and guidance variables influence the development of UMKM performance by BRI Syariah Bank in Yogyakarta City.