Yamada has a mayor-council form of government with a directly elected mayor and a unicameral town council of 14 members. Yamada, together with the city of Miyako, town of Iwaizumi and the villages of Fudai and Tanohata, collectively contributes three seats to the Iwate Prefectural legislature. In terms of national politics, the town is part of Iwate 2nd district of the lower house of the Diet of Japan.
