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This research aims to determine and examine the effect of managerial competence on principals performance and the effect of working motivation on principals performance, and find a model for developing principals performance. This research is using correlation research with an approach of ex-post facto research and held out in the state elementary schools of Medan. The populations of this research are all the school principals in the State Elementary School of Medan, consist of 383 principals. The samples of this research are 200 principal chosen with proportional random sampling technique. The final results of the research conclude that : the performance of state elementary school principals in Medan could be improved by increasing managerial competence, and work motivation.