Floods periodically cause loss of life and damage to property. Provided adequate records are available, it is possible to forecast probabilities of flood damage. Governments have traditionally preferred controlling floods by physical structures. However, flood damage increases over time, partially induced indirectly by these structures, and institutional problems are quite common. Communities have historically not been involved, and inadequate attention has been bestowed on ecological aspects of floods and flood management. Future policy should aim at sustainable flood management, with an institutional system that facilitates sustainability. The paper outlines a framework within which such policy can be developed.