Mining pollution has historically been a major source of degradation of natural resource systems such as river, coastal, and air (USEPA 1995). For this reason, mining, as an economic activity, is subject to major environmental regulations worldwide, including the Philippines. The Philippine mining sector, under Republic Act 7942 and DENR Administrative Order No. 96-40, is required to set up a Contingent Liability and Rehabilitation Fund (CLRF) for the purpose of providing compensation for damages and rehabilitation for any adverse effect a mining activity may cause to the environment. Unfortunately, the current information on mining externalities is insufficient to be useful for policy set-ting. This study was undertaken partly to partly fill this information gap, particularly in the development of policy instruments which require information on social costs of mining, and partly to assist in the formulation of guidelines on damage assessment and compensation for the mining sector. This case study of the Estimation of Environmental Damages from Mining Pollution: The Marinduque Island Mining Accident was implemented.