Construction projects are commonly afflicted by risk due to their uncertainty and complexity in nature. Thus this requires the contractor to have an effective risk management approach. Previous studies revealed that there was no formal risk management being used by the contractors in Malaysia. Hence, the study concentrated on the types of risk involves during construction project, the application of risk management by contractors in Malaysian construction industry and the strategy taken by them to mitigate risks. The research conducted surveys to the contractors registered with the Construction Industry Development Board, Malaysia (CIDB). The finding shows that there is a lack of standardization in the practice of risk management. Risk management has been mandated by the company and that the application has improved project performance. Besides formal approach and educating the people to conduct risk management, it is recommended that a standardized guideline of risk management is needed to improve the application of risk management among contractors in Malaysia.