The league was contested in two regional groups (North Division and South Division), with 12 clubs each.
Međimurje and Pula 1856, winners of the North and South Division, qualified for a two-legged promotion play-off, which took place on 12 and 16 May 2004.
The tie ended in a 2–2 aggregate score and Pula 1856 won it after the penalty shootout ended 5–4 in their favor, thereby earning promotion to the Prva HNL for the following season.
However, Međimurje had another chance for promotion, as the losing team from the promotion play-off played another two-legged tie against the 11th placed team of Prva HNL, Cibalia.
Međimurje won 4–2 on aggregate and was promoted to 2004–05 Prva HNL.