Supplier selection is one of the most critical functions for the success of a company competing in contemporary manufacturing industry. Numerous approaches exist in the literature regarding this important decision problem. In this study, Analytic Hierarchy Process is proposed as an effective tool in selecting an optimal supplier among a group of decision alternatives. Suggested methodology is illustrated by a case study. As far as the requirements of today’s competitive manufacturing environment -such as quality practices, JIT manufacturing practices, quick response, low cost and flexibility- are concerned, it is obvious that a company must attain at least a competitive level of the sepractices among its rivals, to maintain its market position. The procurement side plays an important role and the performance of suppliers is crucial in the company’s battle to meet these requirements.