While the populations of cities continue to grow, institutions are demanding more sustainability in urban development, leading to a great increase in the complexity of urban planning. The need to consider social, legal, environmental, and economic parameters challenges the traditional urban planning processing in favor of an optimized and automated process. Generative design has the potential to optimize the design phase by automatically generating spatial design solutions and analyzing them in the design phase. The objective of the present study is to analyze the traditional urban planning process and to compare it with a digitalized driven process by using generative design. This study uses a mixed approach with four research methods: document analysis, survey, interviews, and a case study based in Sweden. The critical analysis of the Swedish urban planning process makes it possible to define the main barriers to a digitalized process. Results also show the benefits of using generative design for a more sustainable and faster design process. Two main conclusions can be made from this study: institutional and organizational changes are necessary to achieve digitalization, and generative design proves to be a useful tool that should be considered to support the digitalization of urban planning.