Regulators around the world are dealing with a fundamental dilemma. On the one hand, modern economic activity raises the standard of living, but on the other hand, it creates many environmental hazards that harm our quality of life. To balance these controlling effects, they are interested in bringing about social equilibrium and for the value of marginal damage to be equal to the cost of reducing it. The way to deal can be through direct command and control (CAC) or market-based economic tools. Over the years, the use of economic tools in the Organization for Economic Co-operation and Development (OECD) countries increased at the expense of direct regulation, but in Israel, there is still a tendency to use direct regulation. However, since the beginning of the twenty-first century, there has been an increase in the use of economic tools in Israel as well. The chapter examines whether it is better to increase the use of economic tools at the expense of direct regulation. The examination is based on six case studies from various environmental fields in Israel. The results of the research reinforce the argument that economic tools can achieve policy objectives more effectively while driving the market to environmental improvement.