RFID is a technique that plays an important role in identifying and tracking the movement of objects by inserting small chips in objects. It is somewhat similar to bar codes from the various points of applications, but is hopefully considered to lead to tremendous development by solving the present drawbacks of bar codes such as slow identification. Speed, low rate of identification, limitation on the distance of identification and on the amount of saving capacity. Through the development of RFID technique, revolutionary growth is anticipated in the area of logistics and commodity distributional systems. Futhermore, the self processing RFID makes the communications between man and objects possible, and through which introduction of ubiquitous atmosphere will be accelerated. Therefore RFID is considered as one of the most attracting area of investment by developed countries as well as Korea. In this paper, we analyze the world wide tendency on RFID, and propose the conditions for activating RFID industry and also suggest directions for national strategy for diffusing RFID.