Water-retaining structures have been built to facilitate human development for some 5000 years. This paper focuses specifically on their development during the past 50 years, and points out that analyses of actual impacts of large dams are few and far between. Consequently many myths have now enshrined themselves in the literature as facts. The background to the controversy over the Aswan High Dam is analysed. While the western world has basically constructed the dams necessary, the situation is very different from the perspectives of the developing countries, where progress has left much to be desired. Climatic, technical, economic, social, environmental and institutional conditions are very different between the developed and the developing countries, and hence the approaches to water management cannot be identical for the whole world. The main issue facing the developing countries is not whether large dams have an important role to play in the coming decades, since there is really no other choice, but rather how best we can continue to improve their overall effectiveness for human welfare, eradicate poverty and preserve the environment.