An automatic and objective method is developed for evaluating in-situ hydraulic properties of a formation, using the decay of pressure observed during the so-called pressure pulse test. The method utilizes a technique of two-dimensional optimization, where the objective function is defined as a weighted residual sum of squares of the deviation between an experimentally observed pressure decay and a reference curve of the pressure decay, i.e. a type curve, which is theoretically prepared in advance for a given set of hydraulic properties. In order to verify the validity of the method, it was applied to several sets of pressure decay datum, which were constructed theoretically by solving the fluid-flow from a well bore to a permeable rock with given hydraulic properties. It was revealed that the values evaluated by the method were valid within the error of 2%; this is extremely excellent compared to the error caused in the conventional type-curve-fitting by visual inspection for the evaluation of in-situ hydraulic properties. The method was also applied to pressure decay datum during pressure pulse tests performed in two different fields. By the present method, evaluation of hydraulic properties from a set of observed pressure decay datum can be performed almost in realtime. The computation time is less than fifteen seconds by the personal computer NEC PC9801VX(CPU80386 with coprocesser).