Nowadays, the world witnesses a great knowledge wealth that has allowed the developed countries to transform their economies into what is called « Knowledge Economy ». This term, entirely, means producing, spreading and using knowledge in between its
sectors by investing in its fundamental constituents that are manifested in education, research and development.
Through this research, we aim at showing the notions related to the knowledge economy and at the diagnosis of its practical fact in Algeria by presenting the principal challenges that faced this new type of economy and by looking for the mechanisms which must be adopted by the state in order to overcome these obstacles.