The main objective of this research is to conduct a precise analysis of the privileges of public authority and to determine the legal limits of their exercise in administrative contracts. The significance of this study stems from the fact that administrative contracts encompass a substantial portion of economic activities and the provision of public services, making it essential to accurately understand the scope of governmental powers in these contracts. The research method is designed as descriptive-analytical, aiming to comprehensively and scientifically clarify the legal framework governing the privileges of public authority in administrative contracts. The findings indicate that the privileges of public authority in administrative contracts include the right to unilaterally amend contract terms, unilateral termination, sovereign oversight, and the imposition of emergency conditions. The exercise of these powers is conditional upon adherence to principles such as public interest, maintaining contractual balance, and compliance with mandatory laws. Accordingly, the Iranian legal system, relying on principles such as the sovereignty of will (Article 10 of the Civil Code), observance of legal formalities , prohibition of unilateral and unfair clauses, the principle of proportionality, and the necessity of compensation, strives to balance governmental authority with the protection of contractual parties' rights. These limitations, while enhancing transparency and accountability, provide a suitable foundation for reducing corruption, preventing abuse of public power, and promoting trust and private sector participation. However, challenges such as the complexity and ambiguity of some regulations, weaknesses in law enforcement, lack of effective supervisory mechanisms, and difficulties in information access continue to undermine the efficiency of this system. Overall, the existing legal restrictions, by ensuring transparency, justice, and equilibrium in contractual relations, play a crucial role in safeguarding public and private interests, and their reform and enhancement could pave the way for greater sustainability and efficiency in government-private sector relations.