Low-lying islands and atolls are particularly prone to storm surges created by tropical depressions and typhoons. This paper presents a case study of traditional and contemporary settlement patterns of Majuro, the capital of the Republic of the Marshall Islands, and discusses its vulnerability to such storm surges. The paper shows that the application of traditional knowledge extends to the realm of urban planning and that, in fact, ignoring this traditional knowledge as expressed in pre-World War II settlement patterns, exposes urban development to increased flood hazards, a risk which may exact a price too high in life and property.