Regional Trade Agreements (RTAs) are a major feature of today’s multilateral trading system in the talks of free trade liberalization in the WTO. The number of RTAs has been steadily increasing over the last ten years, and sluggish progress in multilateral trade negotiations under the Doha Development Agenda Round appears to have accelerated further the rush to forge RTAs. In fact, RTAs, the major four of which are EU, NAFTA, MERCOSUR and AFTA, now comprise more than half of world trade and RTA are in place on every continent. However, the proliferation of RTAs presents WTO Members and the multilateral trading system with challenges and opportunities. RTAs can play an important role in promoting trade liberalization, and stressed the need for a harmonious relationship between the multilateral and regional process. These facts present a huge challenge to the WTO and the multilateral trading system in which proliferation of RTAs might cause erosion of the disciplines of the WTO, and thus the effectiveness of the multilateral trading system might be weakened. Furthermore, overlapping networks of RTAs might increase their complexity and that of their relationship with the multilateral trading system. A basic question raised in this issue is whether RTAs complement or undermine mutual development of the multilateral trading system. The GATT authorizes the WTO members to enter a regional trading agreement by justifying exemptions to the Most-Favored Nation Principle stipulated in GATT Article I under GATT Article XXIV that says that a group of nations can form a free trade area or customs union by eliminating trade barriers among the nations. In order to meet GATT Article XXIV provisions, there are the three main requirements that the nations have to follow. The first requirement is that trade barriers against non-members not be made one the whole higher or more restrictive than before in line with the GATT Article XXIV:5. The second requirement is that "substantially all" barriers among the members be removed while neither stopping short at partial preferences nor excluding major sectors in line with GATT Article XXIV:8. The third requirement is that RTAs get rid of all tariffs and quantitative restrictions within a reasonable length of time in line with the GATT Article XXIV:5(c). However, our analysis provides the several shortcomings and potential problems by examining the ambiguity of the context of GATT Article XXIV, in particular, Article XXIV:5 and 8 that are requirements for the contracting parties to enter into RTAs. One question emerged in this context is how RTAs affect the multilateral trading system in the WTO. The proliferation of RTAs, many of which are not fully compatible with the disciplines of the WTO, might result in major trade diversion and distortions which undermine the goals of the multilateral trading system. In fact, the WTO remains incapable of addressing the basic legal compatibility of RTAs with the WTO rules. If the agreement with the WTO of prospective RTA participants is not successfully judged, it poses a serious threat to the development of the multilateral trading system and thus become a negative impact on further trade liberalization of the WTO. In order to ensure RTAs compatibility with the WTO, it is essential to strengthen, clarify and improve the WTO rules for RTAs mainly by removing the ambiguity of context of GATT Article XXIV.