The Skills Development Fund (SDF) project has been piloted by the Ministry of Economy and Finance (MEF) since March 2018 to test a new and innovative financing mechanism to promote demand-driven and sustainable skills development with the ultimate objectives of diversifying and increasing value addition of Cambodia’s Economy as well as creating better and well-paid jobs for Cambodian citizens. As a result, the SDF has approved 169 training projects in priority sectors such as Manufacturing, Construction, ICT, Electronics, Automotive, and Tourism amount 14.28 million USD worth of training grants for 32,826 trainees (34% female) under the cost-sharing and joint-training model between industry and training providers (public, private and NGO). Training outcomes include 4% dropout, 88% employment, 85% employers’ satisfaction, the salary of graduate average of $246. This demand-driven model has strongly been welcomed by the market and development partners and has proven to be an effective and efficient model in transforming the training market into a demand-responsive and sustainable skills development. With this success, the Royal Government of Cambodia has transformed this pilot project into a TRUST FUND under the name of Skills Development Fund (SDF) (Sub-Decree 97.RNK.BK dated May 18, 2023) with the Board of Directors comprised of the MEF, relevant line ministries and industry leaders. To date, the SDF has received funding from the Royal Government of Cambodia, and development partners such as the ADB and AFD. The mission of the SDF is to strengthen and expand the demand-driven training market to meet the needs of the economy and private sector as well as generate better and higher-value-added jobs for Cambodian citizens.