Cloud computing brings key advantages to the governments facing conflicting IT challenges. However, the cloud paradigm is still fragmented and concerns over data privacy and regulatory issues presents significant barriers to its adoption. Cloud computing is expected to provide new ways to run IT in public sector. At the same time, it presents significant challenges for governments, and to make the most of cloud, public sector organizations need to make some important decisions. Governments planning to migrate to the cloud are actively moving to harness digital services but with different focus, reasons, and strategy. However, the degree of cloud adoption by the public sector around the globe varies significantly. Most governments are piloting cloud computing but there are huge differences between each country. This chapter explores the state of the art of cloud computing applications in the public sector; various implications and specific recommendation are also provided.