Introduction. The need to adapt agriculture to the conditions of a turbulent external environment requires an increase in the efficiency of state regulation. Solving this problem should be based on rethinking the theoretical and methodological base of the modern food policy effectiveness study from the point of view of institutional analysis. Theoretical analysis. An ordered set of formal and informal institutions constitutes the institutional structure of the agro-food complex. Institutional analysis allows us to answer the question of how modern institutions set exactly the framework for the functioning of the agri-food complex that meets the goals and objectives of its economic security. The elements of institutional analysis include a description of the institute’s content and its functions, the identification of the institute’s evolution patterns and institutional conflicts, the evaluation of the institute’s effectiveness. This makes it possible to build the trajectory of the institute’s transformation in the context of ensuring the economic security of the agricultural sector. Empirical analysis. Modern institutional environment of the agro-industrial complex is characterized by significant deformations under the influence of formal norms and rules, as well as under the influence of their partial replacement by informal institutions, which negatively affects the effectiveness of state regulation and leads to an increase in transaction costs. A detailed analysis of the budget support institute indicates an insufficient level of its complementarity with other institutions, its replacement by an informal institution of “proximity to power”, which leads to regional asymmetry and infringement of the small agribusiness interests in the subsidies distribution. Insufficient amount of support, lack of budget expenditures transparency, their being low-oriented on technological, innovative modernization, form the priority of economic stability over development, create traps of inertial development. Results. Due to low effectiveness of formal institutions for the development of the agricultural sector, the improvement of food policy is of paramount importance. Under the increasing influence of informal institutions, a “hybrid” food policy will be formed. Under these conditions, the trajectory of the agrarian economy institutional environment development is modernization based on inclusive institutions, which will provide a model of sustainable development and economic security of the agricultural sector.