For landscape and conservation ecology to become useful branches of applied ecology, they must be able to inform policy and management decisions, and help solve real problems within the constraints of economic reality. This means applying problem-solving tools used commonly in economics, applied mathematics and engineering. The crucial role of landscape ecologists in conservation is to provide relationships between biodiversity and attributes of the landscape that can be changed by management or policy, such as the configuration of protected or restored areas. We set out seven principles of landscape design for biodiversity based on a formal problem-solving approach. We illustrate these principles by providing a general formulation of the spatial conservation resource allocation problem and with some examples from the recent literature. We argue that good management decisions can only be made using a formal decision-theory approach, where the objectives are clearly stated, constraints such as finances are included, and the ecological information required to formulate the problems are transparent. In this way decisions can be made with full acknowledgement of the assumptions and uncertainties in the process, and we can learn from past successes and failures through a process of active adaptive management.