Ambalat dispute occurs in the area of Ambalat, located off the coast of the Indonesian province of East Kalimantan and southeast of the Malaysian State of Sabah. Many accidents have occurred in this area, and some of them involving navies from both of the state. Although this dispute has called for a need of serious settlement, none of this State has taken an effort to solve this long-term dispute that has become a problem to their harmony life as a neighboring State. Diplomatic protest, navy hot pursuit, and battle of natural resource exploitation are the dispute that be on the list of the effect of this Ambalat dispute, and if this dispute will not be solved in any time soon, the future generation of both state will still inherit and cannot use the natural resources contained in Ambalat area effectively. Seeing the urgency to solve this Ambalat dispute, the author would like to analyze the possible dispute settlement of this dispute, whether it is through ITLOS as it is provided in UNCLOS, or any other peaceful means. In writing this paper, the author is using the book research method.