Grout curtains are commonly constructed under dams to reduce the seepage through the rock foundation. In the design of grout curtains, empirical methods have mainly been used since the introduction of dam foundation grouting. Although empirical methods have been used with success in several projects, they have their limitations, such as poor control of the grout spread, only an indirect consideration of the threat of internal erosion of fracture infillings in the grouted zones, and the risk of hydraulic jacking. This paper presents a theory-based design methodology for grout curtains under dams founded on rock. In the design methodology, the grout curtain is designed as a structural component of the dam. The risk of erosion of fracture infilling material is explicitly accounted for along with the reduction of the hydraulic conductivity of the rock mass, and an optimization of the total uplift force. By applying the proposed design methodology, engineers can create a design better adapted to the prevailing geological and hydrogeological conditions in the rock mass, resulting in more durable grout curtains. The proposed methodology also enables cost and time estimates to be calculated for the grout curtain’s construction. Applying the principles of the observational method during the grouting execution also allows the design to be modified via predefined measures if the initial design is found to be unsuitable.