Organic agriculture is the highest environmentally valuable agricultural system, and has strategic importance at national level that goes beyond the interests of agricultural sector. In this paper we address development of organic farming simulation model based on a system dynamics methodology (SD). The system incorporates relevant variables, which affect the development of the organic farming. The group decision support system (GDSS) was used in order to identify most relevant variables for construction of causal loop diagram and further model development. The model seeks answers to strategic questions related to the level of organically utilized area, levels of production and crop selection in a long term dynamic context and will be used for simulation of different policy scenarios for organic farming and their impact on economic and environmental parameters of organic production at an aggregate level.