This research considers the role of indigenous institutions and conceptions of space in the urban design process for producing culturally appropriate designs for Balinese towns. Employing a pluralistic approach (The Image of the City, MIT Press, Cambridge, MA, 1960; Planning a Pluralist City: Conflicting Realities in Ciudad Guyana, MIT Press, Cambridge, MA, 1976; House Form and Culture, Prentice-Hall, Englewood Cliffs, NJ, 1969, Human Aspects of the Built Form, Pergamon Press, Oxford, 1977), a case study of the town of Gianyar, Bali, Indonesia explores the popular accounts on the operative indigenous conceptions of space in contemporary Balinese urban settings. This exploration aims at providing a ground for reconnecting urban design proposals with their cultural context, thus promoting the spatially expressed localism originating from the diversity of cultures which is currently undermined by the highly standardized process of the Indonesian planning system. In particular, for the town of Gianyar, such an exploration provides a set of placemaking issues which is useful in devising urban design guidelines for achieving a town with more pronounced cultural identity. The research concludes that to achieve culturally appropriate places, the design process has to acknowledge the Balinese Hindu psycho-cosmic concept as the core principle in the design of Balinese townscapes. As such, the existing indigenous cosmic territory, which accommodates the relationship between human (microcosm) and environment (macrocosm), along with its adat law and institution, has to be incorporated in contemporary urban design processes. As a result, urban spatial organization, structure and form will significantly reflect the Balinese cultural identity.