This article discusses legal issues related to the establishment and use of celestial body-based planetary defense systems (CBPDS). It first finds that the application of current international space law to analyze the lawfulness of CBPDS can lead to many ambiguities. Accordingly, this article proposes a new construction of Article IV of the Outer Space Treaty to balance the need to develop celestial body-based planetary defense capacities and the risk of militarization of outer space. According to this article’s approach, neither the “exclusively for peaceful purposes” clause nor the clause prohibiting “military bases, installations and fortifications” on the moon and other celestial bodies prohibit the establishment of CBPDS per se, provided that a State does not employ its armed forces to manage and operate its CBPDS and does not intend to use them for any aggressive purposes. However, a State can only use its CBPDS to test slow push/pull planetary defense techniques and cannot test impulsive techniques through CBPDS. Moreover, a State cannot rely on the peaceful exploration exemption in the last sentence of Article IV of the OST to bypass any of these restrictions.