This study chronologically analyzes the institutional changes of the Seoul Dance Festival(SDF) using the framework of New Institutionalism to identify the festival’s function as an institutional field where national cultural policy, the artists’ community, and social discourse intersect. The research employs a three-tiered analytical framework —policy history, institutional history, and cognitive discourse—to structure the festival’s stages of formation, transition, and institutionalization. The analysis reveals that the SDF’s institutional evolution accompanied the complex interplay of regulative, normative, and cognitive factors. Key drivers included internal critical discourse from the dance community, the national cultural policy’s ‘Arm’s Length Principle’, and the exogenous pressure of adopting ESG-based operations. This empirically demonstrates the realization of Discursive Institutionalism, where social values such as fairness, transparency, and sustainability become internalized as institutional norms. Ultimately, the Seoul Dance Festival transitioned from a ‘regulative institution’ focused on administrative efficiency to a ‘discursive institution’ that has internalized social trust and value. This confirms the shift in Korean arts administration from an emphasis on efficiency rationality to a cultural rationality centered on social discourse.