This study begins by examining the reason for the lack of urban planning that takes the water cycle into consideration. While there are institutions that support environmentally friendly development or smooth water circulation, these designs are not reflected in planning nor in the real world. After reviewing foreign case studies, policy suggestions and possible policy implications for Korea are derived. In Korea, there is not a sufficient level of relevant laws or institutions systematically established to make it possible to deal with rainwater in a decentralized way. Instead, facility standards or guidelines are considered separately for the control of water and for preventing natural disasters. And even though an environmentally friendly approach is stipulated in relevant laws in terms of spatial planning, there are no planning systems or implementation tools to actualize this kind of approach. The factors that make decentralized rainwater management possible in urban planning are analyzed based on the case study of Germany. Germany requires developers to plan in order to achieve ecological urban development. In addition, as a detailed implementation tool to promote conservation of the water cycle, the law provides for various kinds of measures such as restrictions on the proportion of impervious surface area according to the use of the land, required compensation measures for environmental degradation following development, introduction of a fee for rainwater runoff and the establishment of ecological landscape planning. The actual reason these measures can be implemented however is the provision of planning guidelines and design criteria for rainwater utilization, absorption and containment, and the construction of a database for various environmental information.