The wine industry is traditional sector in the Bulgarian economy. However, at the end of the XX century it faced various challenges. Later, it has started to restore and has developed in number of areas. Nowadays it has new characteristics, based on its strengths and weaknesses. Thus, the purpose of the current study is to identify the competitive advantages of the wine sector in Bulgaria. The object of the research are Bulgarian wine producers, who are small and middle size enterprises (SMEs). The focus of the study is a selection of indicators, which contribute for the identification of their competitive advantages. The data used is of own survey, performed among Bulgarian wine producers. The results show that the main advantages are targeted at qualitative wines from authentic local sorts. This justifies the obligatory direction for differentiation and validation of the Bulgarian wine producers by promoting the wines of local varieties and establishing the identity of the wine regions.