This paper reveals the actual status of local governments’ digital readiness in Japan, and describes the stage of achievement in digitalization and related issues. Items requiring analysis are plans for digitalization of governmental administration, organizations, services for residents, information disclosure, and a driving body, as well as impediments to the realization of electronic local governments. The present IT infrastructure in local governments is not yet sufficient, in that the major uses are limited to local area networks (LANs) and e-mail. Prefectures and large cities have relatively advanced governments; however, they are facing financial difficulties. Therefore, it is essential to reduce legacy systems and redirect funds for new IT systems. Security, privacy protection, and organizational conservatism are more important problems to address than equipment shortages.