Reforming of the system of local governance and administrative and territorial structure in Ukraine aims to create the new powerful ground for territorial development. It is about the redistribution of functions in the sphere of public governance, deconcentration and decentralization of liabilities between the state and local authorities and budget decentralization. Current market economy conditions and consolidation of financially incapable territorial communities generate qualitatively new administrative and territorial units – consolidated territorial communities, which merge the economic capacities, creating opportunities for newly created local governments to solve more complicated socio-economic development tasks. However, even in case of absence of own sources to finance territorial development and poor development of productive forces at the territory of a community, it is able to activate financial processes by foreign investment. The reform of local governance in this context opens new opportunities for local governments to attract additional funding through extension of their functions in the sphere of territorial organization of economic processes and development of community’s economic capacity. Therefore, the issue of forming and management of territorial community’s investment capacity as the component of its economic capacity through creation of favourable internal conditions in a community to attract investment becomes of utmost importance. The paper aims to analyze the mechanisms of the endogenous factors’ influence on activation of the use of territorial communities’ investment-innovation capacity in Ukraine in conditions of local governance reform. The mechanisms of the endogenous factors’ influence on activation of the use of territorial communities’ investment-innovation capacity in Ukraine in conditions of local governance reform. The nature of investment capacity is outlined. Endogenous factors of forming and use of territorial community’s innovation capacity are defined. Main indicators of endogenous factors of forming and development of territorial community’s investment are specified. The regions are divided by the share of foreign investment in the period of administrative and territorial reform.