Since the 1990s, arable lands in mountainous areas of South Korea have widely been abandoned due to the serious depopulation for the last few decades. Abandonment of arable lands causes not only a decline in production functions of mountainous villages, but also landscape desolation and environmental problems. Due to same cause, Japan has also experienced the serious abandonment of arable lands in mountainous areas since the 1960s. For the last decade, Japanese government has poured investment to the conservation of terraced paddy fields in hilly and mountainous areas in order to restore those environment values. The attempts of Okayama prefecture for the conservation of terraced paddy fields are well known as a successful story in Japan. In order to suggest an effective conservation means far arable lands in mountainous areas in the context of Korea, this paper examines the background and the implementation means of Japanese conservation policy of terraced paddy fields in hilly and mountainous area, focusing on the case of Okayama prefecture.