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Prostitution in Croatia is illegal  but common. At the turn of the 20th century, prostitution was legal. In Zagreb it was advertised as a tourist attraction and contributed to the city's economy. At one stage every other building was a bordello. To open a brothel, the owner had to register at the town hall and received a licence. The licence required the brothel to be well run and provide a quality service.
The women working in the brothels had to have a twice weekly medical examination. Brothels were not allowed to advertise their presence, but a discrete, uncommonly coloured lantern was allowed to be placed outside. The best known brothels in Zagreb were the Kod Zelene Lampe Green Lantern's , which was the most expensive, the Pick , and the Klub which had cabaret until 5 a. In the s, Zagreb became known as the centre of prostitution in Yugoslavia, with the highest number of prostitutes.
Women from other areas of Yugoslavia, such as Sarajevo , came to the city because of the higher rates for prostitutes compared to their own areas. The economic crisis,  post-communist turmoil and subsequent arrival of international military personnel , demand for prostitution rose.
The opening of borders allowed foreign prostitutes to come to the country. Two acts of law criminalise prostitution and related activities. The Criminal Code also makes third-party involvement illegal. This act was added to Croatian legislation in the year Article 7 forbids using premises for prostitution and enabling or helping another person to engage in prostitution.
The punishment is a fine or up to 60 days' imprisonment. Article 12 forbids 'falling into' prostitution. This is interpreted as repeatedly selling sex. The punishment is a fine or up to 30 days' imprisonment. They can also be expelled from the area the offence took place in for a period of 30 days to 6 months. Since the Croatian criminal law reform, certain activities related to prostitution were included in the Criminal Code.