Recently, advanced methods have been developed for selection of suitable sites for different types of dam. Apart from location, selection of the proper type of dam for a given site is of the greatest importance for engineers. Although these methods are being developed and some new approaches, like GIS techniques, are being used currently, all of these methods are mostly dependent on engineering decision making and a need for high costs. In this study, a new approach in the determination of dam locations is proposed. This method is based on the rough set mathematical theory that is a new approach presented by a well-known mathematician, Pawlak, in 1991. The information obtained from a practical case, the Karkhe project, which is one of the greatest dam projects throughout the middle-east, is used to present the procedure of this method. This dam was investigated in 1994 by famous consulting engineers and 30 places for the construction of this dam were considered. On the basis of the existing data for these places for siting of the Karkhe dam and based on the data required for the rough set method, finding a location for the most suitable site for this dam, using this new method, is undertaken and compared to the practical results obtained from site investigations. The results of this study are completely correlated with practical methods, which were performed by consulting engineers. The results also indicate that using this method for the project results in a total saving of 70% in costs.