The rapid economic expansion in Korea over the last three decades, has been however, accompanied by substantial environmental costs, thus several initiatives were undertaken by the Government, and local communities to address mounting environmental problems... See More +. Such initiatives included the establishment of legal, and institutional framework for environmental governance, phasing out leaded gasoline, improving energy efficiency, and investments in air and water pollution control. The paper highlights the impact of the recent economic crisis, which to Korea's credit, not only environmental regulations, and enforcement remained in place, but air quality indices improved, while water quality indices remained relatively stable. Nonetheless, the shift in industrial production towards small and medium sized enterprises, bears monitoring, budgetary constraints may potentially induce declining water quality indices at industrial, and agro-industrial sites, and, growing vehicle emissions may contribute to environmental pollution. But most of the major environmental issues are related to poor land use management, and to hazardous wastes from defunct businesses as a result of the crisis. Recommendations suggest strengthening environmental performance indicators mainly at the firm level, and institutional capacity, to assess and minimize risks, and liabilities.