Despite the implementation of five development plans before the revolution and two development plans afterwards, development projects in various economic sectors have not fostered national, regional and local development. The question remains as to why development projects have failed to attain their objectives. Various reasons can be counted for this failure; this article, however, only deals with the causes in a planning context. This article attempts to survey the process of. Planning development projects using three approaches i.e., PPBS, programming, and investigating the nature of regional development, and to review the process of devising and implementing development projects in the areas affected. Finally, it is claimed that development projects do not attain their objectives, because planners do not sufficiently incorporate the necessary knowledge into the process of planning, so the projects are not cost- effective. In this article reference is made to Karkhe dam as a model of such projects.