Recently, as various metro lines have been constructed and connected to other lines the rate of utilization has also been increased. However, the existing fare policy which the government does still stick to causes not only inappropriate action to the demand pattern but aggravation of the profit of the operation company. This study reviewed rail fare policy of major countries such as Japan and U.K etc. to improve the rationality of fare policy in Korea. In order to systematical analysis of fare policy, such viewpoints as of fare decision method, the card fare discounting system, the structure of fare, and the government subsidy policy were reviewed. Based on the results from the review, various problems and improvement plans were drawn. Through this study, appropriate fare systems to urban railway users could be given to improve the chronic deficit problem of urban railway operators.