Studies of the type, extent, and volume of Holocene pyroclastic and lahar deposits have concluded that future eruptions of El Misti volcano, even if moderate in magnitude, will pose a serious threat to the city of Arequipa, Peru. After describing the most probable volcanic scenarios at El Misti, this paper concentrates on lahar and flood risk assessment. Scenarios were derived with the help of the simulation codes LAHARZ and TITAN2D. The lahar risk assessment varies significantly depending on the method selected. LAHARZ simulations indicate that a considerable part of the urban areas and infrastructure could be severely affected. Losses due to impacts inflicted by lahars in three selected parts of the urban area are estimated to be in the order of 40–100 million U.S. dollars. In the case of TITAN2D, the resulting lahar-affected area only includes infrastructure assets mainly located along the Río Chili. Results indicate that although simulation codes could be useful tools in the analysis of lahar hazard scenarios, it is still premature to regard them as accurate sources of information for actual decision making related to risk mitigation at the local level. More research is required to further adjust simulation codes and refine risk scenarios. The first priority for the mitigation of the volcanic hazard faced by the city of Arequipa should be improvement of the risk map (a hazard map has already been drawn and is under scrutiny) and the preparation of contingency plans.