UNIDROIT Principles of International Commercial Contracts constitute a soft law instrument which is intended to act outside of any national legal system and which is not to be incorporated into domestic law. The Principles are not a result of work from public or governmental bodies, rather a group of renowned legal experts, active within the UNIDROIT. They were first issued in 1994, with editions published in 2004, 2010 and 2016. The Principles can be used in various ways: as a law governing a contract based on the explicit or implicit choice of the parties, as an alternative option when the parties have not chosen any law to govern their contract, as a means of interpretation or supplementation of domestic law or international uniform law instruments, as a model for national or international legislators, as an accompanying tool for drafting contracts, etc. This paper analyses the genesis and progression of the Principles, their purposes, legal nature, significance and relation with other international legal instruments, especially CISG and PECL.