The food manufacturing industry in Iran has the potential to boost the economy, create jobs, and reduce reliance on oil exports. However, it is currently facing inefficiencies that hinder its competitiveness in international trade. A study analyzed the productivity growth of 22 food sub-sectors in Iran from 1995 to 2003. The main driver of productivity growth was technological progress, while efficiency change played a smaller role. The industry needs to focus on improving technical efficiency to enhance performance. Some sub-sectors were able to reduce input consumption without decreasing output, but others need to expand their scale to improve.