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The strategy of developing sustainable vegetable commodity in the future is not only directed at efforts to develop production in accordance with needs but strengthening institutional farmers is an important part to consider. The study aims to design a structural model of the role of institutions in the development of cayenne agribusiness systems. The study was conducted in Tarakan City, North Kalimantan as a small island of border area. Data collection is done by qualitative method. Interpretative Structural Modeling (ISM) data analysis techniques is used to analyze data or information about institutions that play a role in the development of cayenne agribusiness systems and structural models of the role of institutions in developing cayenne agribusiness systems. The results showed that, the structural model of the institution’s role in the development of the cayenne agribusiness system is based on key actors including the cooperative and SMEs, and the agricultural technology assessment center.