The recent revitalization of the Downtown - a credit to the Westerly-Pawcatuck Joint Development Task Force - has made a major impact on the Town's economic development. Through funding from the Rhode Island Foundation and $710,000 of community development block grant funds, Westerly has been virtually transformed within the past five years. Improvements in urban planning, such as streetscapes, planting, vintage lighting, Christmas lighting, a granite fountain, and new sidewalks, have significantly increased pedestrian traffic and consequently bringing new business owners to the area. Additionally, Westerly is now considered a tax-free arts district, attracting over a dozen galleries as well as fostering a greater cultural atmosphere in the Downtown area.

The other great commercial success in Westerly is tourism. Beyond the obvious lure of the oceanside, there are also a wealth of recreational attractions throughout the town for the benefit of residents and visitors alike. Although there is a slight emphasis on water-related attractions due to the town's location along the Pawcatuck River and Atlantic Ocean, Westerly also offers a number of biking and hiking trails and scenic areas inland. Additionally, an abandoned drive-in movie theater will soon be converted into a golf course at Shelter Harbor. The town council recently resolved to designate these plans as a critical economic concern, which should facilitate the permitting process.

However, Westerly also faces more traditional commercial development as well. Currently, a Home Depot is being proposed at the junction of Route 78 and Route 1, which would add to the commercial strip development in that area.