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This paper, based on the experience of running a workshop on library automation in Estonia combined with visits to several major libraries, outlines the main problems faced by Estonian libraries in recent years and the steps taken to improve the situation. It provides insight, through analysis of articles published by (mostly) Estonian professionals into the problems of identifying the problems — lack of funds, lack of qualifications, organisational problems, and searching for possible solutions: networking, resource sharing, use of information technology and international co‐operation. A description of the role of the Open Society's Regional Library Programme in supporting these steps and details about some of the Estonian libraries that were visited prior to the workshop complete the picture of a varied library landscape, richer for its splendid new national library in one of the smallest states on the outskirts of the new Europe.

This paper sets out to describe the results of a four‐year‐long study into the efficiency of Estonian central public libraries.

The study uses data envelopment analysis (DEA), a non‐parametric linear programming‐based tool to determine the relative efficiency of 20 central public libraries of Estonia. Relative efficiency shows the capacity of an organisation to provide the same output for less expenditure.

The study finds that 40 per cent of the libraries investigated used their resources effectively. Efficiency scores of the rest of the libraries varied from 0.74 to 0.98, with staff expenditure slack being the main inefficiency factor for half of inefficient libraries.

The results of this research enhance the diagnostic capacity for planning the future activities of Estonian central public libraries and offers insights into using DEA for efficiency measurement and decision‐making in public libraries in general.