Over 200 peak amplitudes of strong motion were observed at distances of less than 250 km from the fault during the 1995 Hyogo-ken Nanbu (Kobe) earthquake. We analyzed the attenuation of the peak-ground acceleration and velocity as a function of distance and geological site conditions. The observed peak amplitudes agree well with those predicted by an empirical attenuation relation that was developed for Japanese earthquakes. This demonstrates that on average the peak amplitude of the ground motion generated by this damaging earthquake did not exceed the level predicted by the empirical attenuation relation. We found a significant effect of the surface geology on the observed ground-motion peak amplitude. In particular for soft-soil sites, located near the fault, the peak-horizontal acceleration decreases rapidly with distance as a result of the nonlinear response of soils. In order to take into account the effect of the site conditions we introduced correction factors to the existing attenuation relation. This resulted in a significant reduction of the residuals between the predicted and observed peak amplitudes. Based on the attenuation relation corrected for the site condition effect we generated a map of horizontal peak-ground acceleration in the Kobe and Osaka area for the Kobe earthquake. The area of simulated large ground motion agrees well with the severe damage zone of intensity VII, JMA scale.