In this chapter, the planning of active distribution systems through microgrid formation is discussed. There are four critical steps involved: 1) defining the objectives, 2) defining the microgrid topology, 3) system modeling, and 4) network optimization. The objectives of such planning problems in the literature are extensively reviewed, dominant and popular objectives used are demonstrated. The modeling of microgrid components, such as dispatchable and nondispatchable DGs, load, and energy storage, is reviewed and summarized in the chapter. As critical tools, optimization techniques in planning are summarized. The switch placement in distribution networks is also discussed in this chapter.