Young people are a very important group of modern societies, they will replace the currently ruling generation and will shape our common future. Due to that, young people have become the relevant target of national and international policy and science researches. Youth civic participation is a key aspect of the development of a society and should be shaped by effective youth policy at national and international level. This paper is an attempt of determining the capacity of public institutions and non-government organizations to develop youth civic participation in the context of the European Union youth policy. It reveals the importance of various elements of the potential of institutions’ environment in increasing civic participation of young people on the example of the South Baltic Youth Core Groups Network project which is implemented within the South Baltic Program 2014–2020. The project’s partnership is represented by entities from Denmark, Lithuania, Poland, and Sweden in which the quantitative research was carried out on civic participation of young people aged 14–24. The initial survey results have allowed confirming the hypothesis: the potential of the institutional environment of youth is not fully exploited in the process of increasing civic participation of young people in municipalities involved in the South Baltic Youth Core Groups Network Project. The research has revealed the strengths and weaknesses and barriers and opportunities of public institutions and non-government organizations to enhance youth civic participation in project partner countries.