The Islamic financial industry has been expanding rapidly not only in Middle Eastern countries but also in Southeast Asian Countries, especially in Malaysia since the 2000's. It is obvious that the Islamic financial sector has been developed in Indonesia, the Philippines, Thailand, and Brunei Darussalam. However, there is little academic research on Islamic finance in Brunei Darussalam, where the Islamic financial industry has been expanding in terms of the market share. That is why the object of this paper is to survey the process and explore the prospects of the Islamic financial industry in Brunei Darussalam. Firstly, this paper discusses how the conventional sector in Brunei Darussalam has been established. Then it explains about the introduction and expansion of the Islamic banking sector. After that, it focuses on the framework of the Islamic financial system such as its laws, institutions, and economic policies. In addition, it shows the role of the financial sector and its impact on Brunei's economy. Finally, it summarizes the characteristics and the role of the industry in Brunei's economy.