Baitul-Mal is normally known as a charitable institution. This point is true because presently Baitul-Mal role is more prominent in terms of providing assistance and charitable contributions and donations to the public. In essence, the original scope of Baitul-Mal covers a wider role compared to the current concept of Baitul-Mal. If we view from the context of Baitul-Mal at the early Islam, it turns out that Baitul-Mal is the only and center for the treasury of the state, but in the Malaysian context, scope and functions of Baitul-Mal are limited by the legal constraint. This paper is aimed to analyze the legal constraint and propose some procedures to empower the function and resource mobilization of Baitul-Mal. This paper will also expose that to improve the functions it can be done by using Islamic financial instruments.