This paper presents a comprehensive approach to managing geotechnical risk in Sydney's urban road tunnel projects. Geotechnical risks such as ground instability, water ingress, and interactions with existing infrastructure pose significant challenges to tunnel construction. Through detailed case studies of the Rozelle Interchange and Western Harbour Tunnel, the paper illustrates how advanced site investigations, real-time monitoring, and adaptive engineering solutions are employed to mitigate these risks. The study emphasizes the importance of structured risk assessments and proactive design strategies in ensuring safe and efficient tunnel delivery.