It is substantiated that the institutional concepts of the latest institutional and behavioural economic theory should be placed in the methodological basis of the development of the institutional environment of the land management system. Institutions and institutes are the key to understanding the relationships between all subjects of the economic system of land management, and institutional changes determine the direction of its development and are a defining trend today. The institutional system in the field of land relations, land use and land management is a set of organically interconnected institutions and institutes that are a certain logically complete, integral unity, capable of self-development and self-reproduction, as well as organizations and individuals that act within given institutional restrictions regarding land relations and organization of land use. Firstly, the methodology of institutionalization of land management considers socio-economic systems through holistic development. The principle of the integrity of the socio-economic system research includes an interdisciplinary approach. Secondly, individuals receive characteristics through the prism of the existence of institutions and institutes that condition their behaviour and interaction. Thirdly, institutional changes require not only quantitative, but also qualitative methods of observation, which analyse not the results of changes (for example, indicators of efficiency and growth), but the direction, strategy and the very process of evolution with the clarification of the causes, all stages and forms of transformations.