This research seeks to: describ teacher competence and proposes a hypothetic model for teacher competence development in Madrasah Aliyah of Yogyakarta. This article uses Research & Development (R & D) method to design teacher competence development model. Data collection is based on questionaries, interview and Focus Group Discussion (FGD). Some aspects of teacher competence measured in this research include; paedagogical competence, personal, professional and social competence. The result shows that some aspects of the teacher competences in Madrasah that are still need to be improved are as follow: 1) Paedagogical competence. The Madrasah teachers in Yogyakarta are still need to improve their capacity in facilitating students ability in actualizing and expressing their potential and capacity; 2) Personal Competence. The teachers needs to improve and develop their self government and self descipline in a professional way; 3) Professional competence. The teachers need to develop their aptitude and professionalism sustainably in order to conduct a reflective action and be able to use information technology during the course of teaching-learning process; 4) Social competence. The teachers need increase their skill in communicating with their collagues and among the academic communities.