The article discusses topical problematic aspects associated with the introduction of automated systems based on artificial intelligence (AI) technology in public administration processes, primarily at the city (municipal) level. It is shown that this process is influenced by three key groups of factors: market (issues of the development of the market for AI solutions and its interaction with the state); ethical and technological (issues of transparency and accountability of AI algorithms, credibility of automated systems, ensuring the interoperability of AI systems and data); regulatory (transformation of existing and adoption of new regulations governing the field of AI). All three groups of factors are closely related to each other, and successful implementation of AI solutions requires parallel challenges in each of these groups. The authors highlight the most significant barriers to the implementation of AI solutions in public administration and identify the tools to overcome each of the barriers.