The main activity in Karahallý is the textile manufacture of cotton. Under the Ottoman Empire this town started its manual (hand-loom) industry. Today it is a well developed branch of industry thanks to electronic technologies of  manufacture. There are several kinds of cotton fabrics being produced here. The factory owners are a very dynamic group in Turkey. In the town there are between 1000 to 1200 electronic machines. The production takes place in small factories as well as in big modern works. The economy in this branch is developing a market which has its importance at an international level.

The second sector of economy is the agriculture. Wheat, cotton, poppy, tobacco, lentils and sesame are produced as well as different kinds of white and red grapes  from which wine is being made in the town of Bekilli (17 km away from Karahallý). This local wine is known for its good quality.