There is widespread recognition today that we are living in a period of profound technological, social, economic and political change, and that this process of change is accelerating. Yet, there is less certainty about the nature and meaning of these changes—whether they should be regulated or liberalized, supported or resisted— and the kind of world they are leading to. Despite these uncertainties and the difficulties of evaluating the significance of events and processes as they occur, four fundamental trends can be identified that are dramatically transforming the contemporary world and are shaping a new world. These trends are the continued rapid urbanization of the world's population, particularly in the developing countries, the globalization of economic, social, cultural and political activities, the intensification and globalization of an ‘environmental crisis’, and the changing relationship of the state to the civil society. Although it is true to say that all cities in the emerging global system are experiencing the effects of these processes, it is perhaps in the cities of the developing countries that the greatest problems and challenges are emerging. Among many other disciplines and professional activities, efforts have also been made in the field of urban design during the last decade or so to find appropriate ways within the field for dealing with these challenges and to explore the potential contribution urban design can make to change the existing trend and facilitate the achievement of sustainability in urban areas. The degree of success, however, has not been the same in all countries and definitely in all areas. Moreover, the gap between the theory and practice remains critically vast everywhere. Therefore, this paper aims to first review the global achievements in sustainable urban design, both in theory (research) and practice, and then do a critical analysis of the challenges the idea has been facing in the contemporary urban design in Iran. To do so, the study focuses on the major substantive and procedural attributes of urban design at both macro and micro levels, and reveals the purposes they serve towards achieving sustainability in urban areas. At the end, a critical comparison is made between the international achievements in the area of sustainable urban design and the efforts made in Iran in this regard.