It is expected for small and medium-sized to be a locomotive for economic growth in the Arab countries during the coming decades. In addition to providing many job opportunities for the steady population growth. The role of the sector, small and medium enterprises in creating jobs and combating unemployment in the Arab countries increased on two fronts, first: to combat high unemployment. The second front: meet the needs of Arab countries, the development of 100 million jobs during the next twenty years. The aim of this paper is to study small and medium enterprises and their role in employment and job creation in the Arab countries. By identifying the concept of small businesses and their importance to the Arab countries. In addition to presenting the most important challenges facing the development of these projects. Finally, the paper tries to recommend a number of policies for the development and activation of this important sector and increase its role in employment and job creation in the Arab countries.