Land use conflicts are recognized as the result of mismanagement of infrastructural development projects. Several issues have been conferred related to infrastructural projects in Asia and South Asia, like corruption, mismanagement, cronyism and adverse socioeconomic impacts. The paper focuses particularly on land use conflicts related to Diamer-Bhasha Dam project in northern Pakistan. Keeping in view this peculiar case, it goes into the concept of conflicts and proximity, e.g. types of proximity and the role they play in conflict generation, conflict resolution and modes of conflict prevention. We provide the different types and expressions of conflicts due to Diamer-Bhasha Dam project, their impact on local population and the territory, e.g. unfair land acquisition, improper displacement, compensation, resettlement and livelihood issues. Contiguity problems due to geographical proximity as well as mechanisms of conflict resolution through organized proximity are also discussed. Finally, we conclude and recommend the strategies for better governance and the way ahead for upcoming studies on similar issues.