Pasar Siti Khadijah is one of the most popular traditional market in Kota Bharu, Kelantan

Kelantan has a chiefly agrarian economy dominated by rice, rubber and tobacco. Fishing along its 96-kilometre coastline is also an important economic activity. Cottage industries which employ traditional skills in handicraft production such as batik, woodcarving and songket weaving are also evident.

Logging activities are active despite depleting forest areas. In recent years, tourism, especially to offshore islands, has increased in importance. A few reputable hotels have been established and more modern shopping malls have been opened to cater for urban folks.

Kota Bharu, the capital, is the major urban centre, and there are also plans to open up the southern portion of the state under an ambitious multimillion-dollar development project. The main market at the city centre, Pasar Siti Khadijah,  is a top attraction.

Kelantan had a GDP per capita in 2006 at RM7,985. The State Socioeconomic Report 2017 published on July 26, 2018 reported that Kelantan has a GDP per capita of RM13,593 in 2017, significantly lower than any other state in Malaysia.