The reduction of the environmental impacts from central districts is considered as an urgent global problem. A life-cycle assessment method has been applied in several empirical studies, while the interactive linkage of the estimation results with the strategy of societal policieshave been seldom investigated so far. In this study the frame for calculating the CO₂ emissions from urban development, which includes buildings and infrastructures, is established to analyze the characteristics of environmental impacts and to estimate the effects of environmental impact reduction method. Environmental impacts from urban activities are found as much larger than those from urban structures, and those from the inside of urban areas are much larger than those from the outside of urban areas. Not only direct methods such as saving energy and more efficient traffic system but also indirect methods such as modal shift and planned unit development are found to be effective for life cycle CO₂ reduction.