This article examines how Azerbaijan, as an emerging middle power, uses niche diplomacy to build stronger ties with the states of the Western Balkans and increase regional and international influence. It discusses Azerbaijan’s proactive foreign policy in the Western Balkans as a qualitative case study and applies document analysis, media content analysis and process tracing to explain the country’s rise as a middle power in the region. The analysis identifies energy security, infrastructure development and soft power diplomacy as the main niche assets of Azerbaijan’s diplomatic outreach in the Western Balkans. It concludes that sectoral specialization in regional foreign policy activism facilitates emerging middle powers to gain a competitive advantage and expand their geopolitical influence.