Since 2010, Myanmar has rapidly increased its apparel exports, especially to Japan. Production fragmentation in East Asia, has been the main factor of this increase whereby labor-intensive manufacturing is shifted to low income countries. Additionally employment of unskilled worker is also rising along with this growth. In this context, this study examines development of garment industry in Myanmar, focusing on their integration into the regional economy, employment of unskilled workers and the industrial upgrades in process and products. <br> Myanmar increased its apparel exports from mid-1990s to early 2000s, but declined after the US imposed an import ban on all its products. Its apparel export gradually recovered in mid-2000s and was broadly flat in the late 2000s. However, it has risen rapidly led by orders from Japan which is not an easy market for low income countries. This study reveals that Myanmar not only expands the apparel export volume but also begins to produce the higher-value added items including outer wears and women's clothes since 2010.<br> Labor demands in Myanmar's garment industry have also risen inconjuction with the increasing apparel exports since 2010. Despite the availability of abundant low-wage labor, recognized as one of the advantages of Myanmar's garment industry, there is a lack of skilled sewing operators. This paper also examines Myanmar's garment firms' success in upgrading products despite the employment of substaintial mumber of unskilled workers. Almost all garment factories in Myanmar use progressive bundle system where the tasks of garment production are broken into small operations. In this system, operators with varying skill levels are assigned tasks based on their skill or diffculty of individual tasks in the production line. Moreover, the tasks are broken into smaller operations in factories in Myanmar than the factories in China. Consequently, unskilled workers and helpers can perform the simpler tasks allowing scarce skilled workers to assume more difficult and important tasks in the production line. This production process is contributing in upgrades in product items that meet the stringent quality requirements of Japanese buyers.