It is found through centrifuge model tests that the cyclic lateral load on a pile reduces the shaft friction and induces additional pile settlement. A theoretical model using the load-transfer method was proposed for the settlement prediction of cyclic laterally loaded piles in dry sand. A simple formula was established to quickly predict the pile settlement in practical engineering. The theoretical model provided a reasonable estimate of the pile settlement, while the predictions from the proposed quick prediction formula were relatively conservative. A new concept of “settlement-controlled design” was proposed to advance the methodology for the design of a pile by considering potential settlement after many cycles of lateral loads. According to the design plane derived from this study, the design-state points were suggested to be limited in the convergent zone.