This paper examines the causes of the worsening of the Dokdo territorial dispute during the San Francisco Peace Treaty negotiations. The reason why the treaty aggravated the Dokdo territorial dispute was that it didn`t make a clear conclusion about who holds the sovereignty over Dokdo. As the US had the biggest influence among the Allied forces, this research will concentrate primarily on the role of the US in the treaty negotiations. As communism was spreading in East Asia, the US reconsidered their political and geographical evaluation of Japan. As a result, the treaty was negotiated to be advantageous for Japan, and Dokdo dispute turned unfavorable for Korea. However, the greatest cause of this unfavorable situation was the diplomatic blunder of the Korean government. During the treaty negotiations, there was an opportunity for Korea to persuade the US about Korean sovereignty over the Dokdo islets. But Korea provided wrong information about Dokdo, and lost their credibility. There were the special circumstances of being in a war; however, we cannot deny that the diplomatic mistakes of Korean government were an important factor in the worsening of the Dokdo territorial dispute.