The potential of environmental assessment as a sustainability instrument haslong been recognized, but the criteria against which development proposals traditionally are judged are not necessarily criteria for sustainable development. Meanwhile, Agenda 21 identified the need for indicators of sustainable development for use in decision-making, but those that have been developed are not easy to apply in project level environmental assessment. These problems are addressed by returning to the fundamental principles of sustainable development and relating them to the principles of environmental assessment. In this way, 18 criteria have been derived, all of which must be satisfied if a development proposal is to be classified as sustainable development. These criteria have been tested against a number of actual environmental assessments to identify the likely consequences for project approval. The porpose of this paper is to theoretically show the basic principles of sustainability including indicators in the context of assessing the enviromental and other project related factors concerning sustainability.